Correlation Between CaliberCos and Swiftmerge Acquisition

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

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

Diversification Opportunities for CaliberCos and Swiftmerge Acquisition

-0.34

Correlation Coefficient

CaliberCos  Swiftmerge Acquisition

Very good diversification

The 3 months correlation between CaliberCos and Swiftmerge is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding CaliberCos Class A and Swiftmerge Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swiftmerge Acquisition and CaliberCos 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 CaliberCos Class A are associated (or correlated) with Swiftmerge Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swiftmerge Acquisition has no effect on the direction of CaliberCos i.e., CaliberCos and Swiftmerge Acquisition go up and down completely randomly.

Pair Corralation between CaliberCos and Swiftmerge Acquisition

Considering the 90-day investment horizon CaliberCos Class A is expected to generate 0.67 times more return on investment than Swiftmerge Acquisition. However, CaliberCos Class A is 1.5 times less risky than Swiftmerge Acquisition. It trades about 0.35 of its potential returns per unit of risk. Swiftmerge Acquisition Corp is currently generating about -0.26 per unit of risk. If you would invest  52.00  in CaliberCos Class A on October 8, 2024 and sell it today you would earn a total of  18.00  from holding CaliberCos Class A or generate 34.62% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	31.58%
Values	Daily Returns

CaliberCos Class A  vs.  Swiftmerge Acquisition Corp

CaliberCos Class A

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CaliberCos Class A are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, CaliberCos exhibited solid returns over the last few months and may actually be approaching a breakup point.

Swiftmerge Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Swiftmerge Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable fundamental indicators, Swiftmerge Acquisition is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with CaliberCos and Swiftmerge Acquisition

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

The idea behind CaliberCos Class A and Swiftmerge 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.