Correlation Between BurTech Acquisition and Patria Latin

Can any of the company-specific risk be diversified away by investing in both BurTech Acquisition and Patria Latin at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining BurTech Acquisition and Patria Latin into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between BurTech Acquisition Corp and Patria Latin American, you can compare the effects of market volatilities on BurTech Acquisition and Patria Latin and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in BurTech Acquisition with a short position of Patria Latin. Check out your portfolio center. Please also check ongoing floating volatility patterns of BurTech Acquisition and Patria Latin.

Diversification Opportunities for BurTech Acquisition and Patria Latin

-0.7

Correlation Coefficient

BurTech Acquisition  Patria Latin

Excellent diversification

The 3 months correlation between BurTech and Patria is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding BurTech Acquisition Corp and Patria Latin American in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Patria Latin American and BurTech Acquisition is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on BurTech Acquisition Corp are associated (or correlated) with Patria Latin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Patria Latin American has no effect on the direction of BurTech Acquisition i.e., BurTech Acquisition and Patria Latin go up and down completely randomly.

Pair Corralation between BurTech Acquisition and Patria Latin

Assuming the 90 days horizon BurTech Acquisition Corp is expected to under-perform the Patria Latin. In addition to that, BurTech Acquisition is 4.83 times more volatile than Patria Latin American. It trades about -0.04 of its total potential returns per unit of risk. Patria Latin American is currently generating about 0.05 per unit of volatility. If you would invest  1,141  in Patria Latin American on September 5, 2024 and sell it today you would earn a total of  22.00  from holding Patria Latin American or generate 1.93% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	96.0%
Values	Daily Returns

BurTech Acquisition Corp  vs.  Patria Latin American

BurTech Acquisition Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BurTech Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's technical indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Patria Latin American

Risk-Adjusted Performance

0 of 100

Good

Over the last 90 days Patria Latin American has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Patria Latin is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with BurTech Acquisition and Patria Latin

The main advantage of trading using opposite BurTech Acquisition and Patria Latin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BurTech Acquisition position performs unexpectedly, Patria Latin can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Patria Latin will offset losses from the drop in Patria Latin's long position.

The idea behind BurTech Acquisition Corp and Patria Latin American pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.