Correlation Between Embrace Change and Marblegate Acquisition

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

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

Diversification Opportunities for Embrace Change and Marblegate Acquisition

-0.12

Correlation Coefficient

Embrace Change  Marblegate Acquisition

Good diversification

The 3 months correlation between Embrace and Marblegate is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Embrace Change Acquisition and Marblegate Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marblegate Acquisition and Embrace Change 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 Embrace Change Acquisition are associated (or correlated) with Marblegate Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marblegate Acquisition has no effect on the direction of Embrace Change i.e., Embrace Change and Marblegate Acquisition go up and down completely randomly.

Pair Corralation between Embrace Change and Marblegate Acquisition

Assuming the 90 days horizon Embrace Change Acquisition is expected to under-perform the Marblegate Acquisition. In addition to that, Embrace Change is 1.28 times more volatile than Marblegate Acquisition Corp. It trades about -0.05 of its total potential returns per unit of risk. Marblegate Acquisition Corp is currently generating about 0.01 per unit of volatility. If you would invest  1,109  in Marblegate Acquisition Corp on September 4, 2024 and sell it today you would earn a total of  4.00  from holding Marblegate Acquisition Corp or generate 0.36% return on investment over 90 days.

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

Embrace Change Acquisition  vs.  Marblegate Acquisition Corp

Embrace Change Acqui

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Embrace Change Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, Embrace Change is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Marblegate Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Embrace Change and Marblegate Acquisition

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

The idea behind Embrace Change Acquisition and Marblegate 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.