Correlation Between ESGEN Acquisition and Moringa Acquisition

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

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

Diversification Opportunities for ESGEN Acquisition and Moringa Acquisition

-0.22

Correlation Coefficient

ESGEN Acquisition  Moringa Acquisition

Very good diversification

The 3 months correlation between ESGEN and Moringa is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding ESGEN Acquisition Corp and Moringa Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Moringa Acquisition Corp and ESGEN 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 ESGEN Acquisition Corp are associated (or correlated) with Moringa Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Moringa Acquisition Corp has no effect on the direction of ESGEN Acquisition i.e., ESGEN Acquisition and Moringa Acquisition go up and down completely randomly.

Pair Corralation between ESGEN Acquisition and Moringa Acquisition

If you would invest  1,101  in ESGEN Acquisition Corp on October 3, 2024 and sell it today you would earn a total of  0.00  from holding ESGEN Acquisition Corp or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	0.56%
Values	Daily Returns

ESGEN Acquisition Corp  vs.  Moringa Acquisition Corp

ESGEN Acquisition Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Moringa Acquisition Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Moringa Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental indicators, Moringa Acquisition is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with ESGEN Acquisition and Moringa Acquisition

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

The idea behind ESGEN Acquisition Corp and Moringa 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..