Correlation Between Financial Strategies and Marblegate Acquisition

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

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

Diversification Opportunities for Financial Strategies and Marblegate Acquisition

0.19

Correlation Coefficient

Financial Strategies  Marblegate Acquisition

Average diversification

The 3 months correlation between Financial and Marblegate is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Financial Strategies Acquisiti and Marblegate Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marblegate Acquisition and Financial Strategies 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 Financial Strategies 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 Financial Strategies i.e., Financial Strategies and Marblegate Acquisition go up and down completely randomly.

Pair Corralation between Financial Strategies and Marblegate Acquisition

Assuming the 90 days horizon Financial Strategies Acquisition is expected to generate 1.26 times more return on investment than Marblegate Acquisition. However, Financial Strategies is 1.26 times more volatile than Marblegate Acquisition Corp. It trades about 0.09 of its potential returns per unit of risk. Marblegate Acquisition Corp is currently generating about 0.07 per unit of risk. If you would invest  2.00  in Financial Strategies Acquisition on October 23, 2024 and sell it today you would lose (0.70) from holding Financial Strategies Acquisition or give up 35.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	12.32%
Values	Daily Returns

Financial Strategies Acquisiti  vs.  Marblegate Acquisition Corp

Financial Strategies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Financial Strategies Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Financial Strategies is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated 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 fairly stable technical and fundamental indicators, Marblegate Acquisition is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Financial Strategies and Marblegate Acquisition

The main advantage of trading using opposite Financial Strategies and Marblegate Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Financial Strategies 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 Financial Strategies 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.