Correlation Between Inflection Point and Himalaya Shipping

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

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

Diversification Opportunities for Inflection Point and Himalaya Shipping

-0.85

Correlation Coefficient

Inflection Point  Himalaya Shipping

Pay attention - limited upside

The 3 months correlation between Inflection and Himalaya is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Inflection Point Acquisition and Himalaya Shipping in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Himalaya Shipping and Inflection Point 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 Inflection Point Acquisition are associated (or correlated) with Himalaya Shipping. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Himalaya Shipping has no effect on the direction of Inflection Point i.e., Inflection Point and Himalaya Shipping go up and down completely randomly.

Pair Corralation between Inflection Point and Himalaya Shipping

Assuming the 90 days horizon Inflection Point Acquisition is expected to generate 16.5 times more return on investment than Himalaya Shipping. However, Inflection Point is 16.5 times more volatile than Himalaya Shipping. It trades about 0.05 of its potential returns per unit of risk. Himalaya Shipping is currently generating about 0.02 per unit of risk. If you would invest  0.00  in Inflection Point Acquisition on October 23, 2024 and sell it today you would earn a total of  1,295  from holding Inflection Point Acquisition or generate 9.223372036854776E16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	91.63%
Values	Daily Returns

Inflection Point Acquisition  vs.  Himalaya Shipping

Inflection Point Acq

Risk-Adjusted Performance

6 of 100

Modest

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

Himalaya Shipping

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Himalaya Shipping has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's technical indicators remain relatively invariable which may send shares a bit higher in February 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Inflection Point and Himalaya Shipping

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

The idea behind Inflection Point Acquisition and Himalaya Shipping 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.

Check out your portfolio center.

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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.