Correlation Between Helius Medical and InFintT Acquisition

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

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

Diversification Opportunities for Helius Medical and InFintT Acquisition

-0.51

Correlation Coefficient

Helius Medical  InFintT Acquisition

Excellent diversification

The 3 months correlation between Helius and InFintT is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Helius Medical Technologies and InFintT Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on InFintT Acquisition Corp and Helius Medical 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 Helius Medical Technologies are associated (or correlated) with InFintT Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of InFintT Acquisition Corp has no effect on the direction of Helius Medical i.e., Helius Medical and InFintT Acquisition go up and down completely randomly.

Pair Corralation between Helius Medical and InFintT Acquisition

Given the investment horizon of 90 days Helius Medical Technologies is expected to generate 0.69 times more return on investment than InFintT Acquisition. However, Helius Medical Technologies is 1.45 times less risky than InFintT Acquisition. It trades about 0.02 of its potential returns per unit of risk. InFintT Acquisition Corp is currently generating about -0.2 per unit of risk. If you would invest  97.00  in Helius Medical Technologies on September 30, 2024 and sell it today you would lose (27.00) from holding Helius Medical Technologies or give up 27.84% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	35.71%
Values	Daily Returns

Helius Medical Technologies  vs.  InFintT Acquisition Corp

Helius Medical Techn

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Helius Medical Technologies are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent fundamental indicators, Helius Medical unveiled solid returns over the last few months and may actually be approaching a breakup point.

InFintT Acquisition Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days InFintT Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy forward indicators, InFintT Acquisition is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Helius Medical and InFintT Acquisition

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

The idea behind Helius Medical Technologies and InFintT 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.