Correlation Between Mink Therapeutics and PowerUp Acquisition

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

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

Diversification Opportunities for Mink Therapeutics and PowerUp Acquisition

-0.11

Correlation Coefficient

Mink Therapeutics  PowerUp Acquisition

Good diversification

The 3 months correlation between Mink and PowerUp is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Mink Therapeutics 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 Mink Therapeutics 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 Mink Therapeutics 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 Mink Therapeutics i.e., Mink Therapeutics and PowerUp Acquisition go up and down completely randomly.

Pair Corralation between Mink Therapeutics and PowerUp Acquisition

Given the investment horizon of 90 days Mink Therapeutics is expected to generate 3.28 times more return on investment than PowerUp Acquisition. However, Mink Therapeutics is 3.28 times more volatile than PowerUp Acquisition Corp. It trades about 0.01 of its potential returns per unit of risk. PowerUp Acquisition Corp is currently generating about 0.02 per unit of risk. If you would invest  201.00  in Mink Therapeutics on October 5, 2024 and sell it today you would lose (100.00) from holding Mink Therapeutics or give up 49.75% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Mink Therapeutics  vs.  PowerUp Acquisition Corp

Mink Therapeutics

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Mink Therapeutics are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady forward-looking signals, Mink Therapeutics unveiled solid returns over the last few months and may actually be approaching a breakup point.

PowerUp Acquisition Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Mink Therapeutics and PowerUp Acquisition

The main advantage of trading using opposite Mink Therapeutics and PowerUp Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mink Therapeutics 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 Mink Therapeutics 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.