Correlation Between Dune Acquisition and Genesis Unicorn

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

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

Diversification Opportunities for Dune Acquisition and Genesis Unicorn

0.0

Correlation Coefficient

Dune Acquisition  Genesis Unicorn

Pay attention - limited upside

The 3 months correlation between Dune and Genesis is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Dune Acquisition Corp and Genesis Unicorn Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genesis Unicorn Capital and Dune 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 Dune Acquisition Corp are associated (or correlated) with Genesis Unicorn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genesis Unicorn Capital has no effect on the direction of Dune Acquisition i.e., Dune Acquisition and Genesis Unicorn go up and down completely randomly.

Pair Corralation between Dune Acquisition and Genesis Unicorn

If you would invest (100.00) in Genesis Unicorn Capital on December 5, 2024 and sell it today you would earn a total of  100.00  from holding Genesis Unicorn Capital or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Dune Acquisition Corp  vs.  Genesis Unicorn Capital

Dune Acquisition Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Dune Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Dune Acquisition is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Genesis Unicorn Capital

Risk-Adjusted Performance

Very Weak

Over the last 90 days Genesis Unicorn Capital has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Genesis Unicorn 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 Dune Acquisition and Genesis Unicorn

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

The idea behind Dune Acquisition Corp and Genesis Unicorn Capital 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.