Correlation Between Integral and Mars Acquisition

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

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

Diversification Opportunities for Integral and Mars Acquisition

0.22

Correlation Coefficient

Integral  Mars Acquisition

Modest diversification

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

Pair Corralation between Integral and Mars Acquisition

If you would invest  38.00  in Mars Acquisition Corp on October 25, 2024 and sell it today you would earn a total of  0.00  from holding Mars Acquisition Corp or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	31.58%
Values	Daily Returns

Integral Ad Science  vs.  Mars Acquisition Corp

Integral Ad Science

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Integral Ad Science has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Mars Acquisition Corp

Risk-Adjusted Performance

0 of 100

Solid

Over the last 90 days Mars Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively weak basic indicators, Mars Acquisition reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Integral and Mars Acquisition

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

The idea behind Integral Ad Science and Mars 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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.