Correlation Between CVD Equipment and Greenland Acquisition

Can any of the company-specific risk be diversified away by investing in both CVD Equipment and Greenland Acquisition 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 CVD Equipment and Greenland Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CVD Equipment and Greenland Acquisition Corp, you can compare the effects of market volatilities on CVD Equipment and Greenland Acquisition 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 CVD Equipment with a short position of Greenland Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVD Equipment and Greenland Acquisition.

Diversification Opportunities for CVD Equipment and Greenland Acquisition

-0.4

Correlation Coefficient

CVD Equipment  Greenland Acquisition

Very good diversification

The 3 months correlation between CVD and Greenland is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding CVD Equipment and Greenland Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greenland Acquisition and CVD Equipment 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 CVD Equipment are associated (or correlated) with Greenland Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greenland Acquisition has no effect on the direction of CVD Equipment i.e., CVD Equipment and Greenland Acquisition go up and down completely randomly.

Pair Corralation between CVD Equipment and Greenland Acquisition

Considering the 90-day investment horizon CVD Equipment is expected to under-perform the Greenland Acquisition. But the stock apears to be less risky and, when comparing its historical volatility, CVD Equipment is 1.29 times less risky than Greenland Acquisition. The stock trades about 0.0 of its potential returns per unit of risk. The Greenland Acquisition Corp is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  190.00  in Greenland Acquisition Corp on September 2, 2024 and sell it today you would earn a total of  28.00  from holding Greenland Acquisition Corp or generate 14.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

CVD Equipment  vs.  Greenland Acquisition Corp

CVD Equipment

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CVD Equipment has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Greenland Acquisition

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Greenland Acquisition Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak technical and fundamental indicators, Greenland Acquisition exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CVD Equipment and Greenland Acquisition

The main advantage of trading using opposite CVD Equipment and Greenland Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVD Equipment position performs unexpectedly, Greenland Acquisition 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 Greenland Acquisition will offset losses from the drop in Greenland Acquisition's long position.

The idea behind CVD Equipment and Greenland Acquisition Corp 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.