Correlation Between Cartica Acquisition and Aquagold International
Can any of the company-specific risk be diversified away by investing in both Cartica Acquisition and Aquagold International 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 Cartica Acquisition and Aquagold International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cartica Acquisition Corp and Aquagold International, you can compare the effects of market volatilities on Cartica Acquisition and Aquagold International 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 Cartica Acquisition with a short position of Aquagold International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cartica Acquisition and Aquagold International.
Diversification Opportunities for Cartica Acquisition and Aquagold International
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cartica and Aquagold is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cartica Acquisition Corp and Aquagold International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aquagold International and Cartica 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 Cartica Acquisition Corp are associated (or correlated) with Aquagold International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aquagold International has no effect on the direction of Cartica Acquisition i.e., Cartica Acquisition and Aquagold International go up and down completely randomly.
Pair Corralation between Cartica Acquisition and Aquagold International
Assuming the 90 days horizon Cartica Acquisition Corp is expected to generate 3.03 times more return on investment than Aquagold International. However, Cartica Acquisition is 3.03 times more volatile than Aquagold International. It trades about 0.16 of its potential returns per unit of risk. Aquagold International is currently generating about 0.06 per unit of risk. If you would invest 11.00 in Cartica Acquisition Corp on September 23, 2024 and sell it today you would earn a total of 24.00 from holding Cartica Acquisition Corp or generate 218.18% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 45.47% |
Values | Daily Returns |
Cartica Acquisition Corp vs. Aquagold International
Performance |
Timeline |
Cartica Acquisition Corp |
Aquagold International |
Cartica Acquisition and Aquagold International Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Cartica Acquisition and Aquagold International
The main advantage of trading using opposite Cartica Acquisition and Aquagold International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cartica Acquisition position performs unexpectedly, Aquagold International 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 Aquagold International will offset losses from the drop in Aquagold International's long position.Cartica Acquisition vs. Aquagold International | Cartica Acquisition vs. Morningstar Unconstrained Allocation | Cartica Acquisition vs. Thrivent High Yield | Cartica Acquisition vs. Via Renewables |
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Check out your portfolio center.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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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