Correlation Between Evertz Technologies and PowerUp Acquisition

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

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

Diversification Opportunities for Evertz Technologies and PowerUp Acquisition

0.41

Correlation Coefficient

Evertz Technologies  PowerUp Acquisition

Very weak diversification

The 3 months correlation between Evertz and PowerUp is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Evertz Technologies Limited and PowerUp Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PowerUp Acquisition Corp and Evertz Technologies 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 Evertz Technologies Limited are associated (or correlated) with PowerUp Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PowerUp Acquisition Corp has no effect on the direction of Evertz Technologies i.e., Evertz Technologies and PowerUp Acquisition go up and down completely randomly.

Pair Corralation between Evertz Technologies and PowerUp Acquisition

Assuming the 90 days horizon Evertz Technologies is expected to generate 1.36 times less return on investment than PowerUp Acquisition. But when comparing it to its historical volatility, Evertz Technologies Limited is 1.01 times less risky than PowerUp Acquisition. It trades about 0.07 of its potential returns per unit of risk. PowerUp Acquisition Corp is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  1,144  in PowerUp Acquisition Corp on October 26, 2024 and sell it today you would earn a total of  76.00  from holding PowerUp Acquisition Corp or generate 6.64% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.16%
Values	Daily Returns

Evertz Technologies Limited  vs.  PowerUp Acquisition Corp

Evertz Technologies

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Evertz Technologies Limited are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Evertz Technologies is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

PowerUp Acquisition Corp

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in PowerUp Acquisition Corp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, PowerUp Acquisition may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Evertz Technologies and PowerUp Acquisition

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

The idea behind Evertz Technologies Limited and PowerUp 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.