Correlation Between CVW CleanTech and Inflection Point

Can any of the company-specific risk be diversified away by investing in both CVW CleanTech and Inflection Point 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 CVW CleanTech and Inflection Point into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for CVW CleanTech and Inflection Point

0.4

Correlation Coefficient

CVW CleanTech  Inflection Point

Very weak diversification

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

Pair Corralation between CVW CleanTech and Inflection Point

Assuming the 90 days horizon CVW CleanTech is expected to generate 1.31 times more return on investment than Inflection Point. However, CVW CleanTech is 1.31 times more volatile than Inflection Point Acquisition. It trades about 0.01 of its potential returns per unit of risk. Inflection Point Acquisition is currently generating about -0.07 per unit of risk. If you would invest  65.00  in CVW CleanTech on December 22, 2024 and sell it today you would lose (4.00) from holding CVW CleanTech or give up 6.15% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	91.67%
Values	Daily Returns

CVW CleanTech  vs.  Inflection Point Acquisition

CVW CleanTech

Risk-Adjusted Performance

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in CVW CleanTech are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical and fundamental indicators, CVW CleanTech is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Inflection Point Acq

Risk-Adjusted Performance

Very Weak

Over the last 90 days Inflection Point Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with CVW CleanTech and Inflection Point

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

The idea behind CVW CleanTech and Inflection Point Acquisition 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..