Correlation Between Swiftmerge Acquisition and Via Renewables

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

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

Diversification Opportunities for Swiftmerge Acquisition and Via Renewables

-0.16

Correlation Coefficient

Swiftmerge Acquisition  Via Renewables

Good diversification

The 3 months correlation between Swiftmerge and Via is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Swiftmerge Acquisition Corp and Via Renewables in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Via Renewables and Swiftmerge Acquisition 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 Swiftmerge Acquisition Corp are associated (or correlated) with Via Renewables. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Via Renewables has no effect on the direction of Swiftmerge Acquisition i.e., Swiftmerge Acquisition and Via Renewables go up and down completely randomly.

Pair Corralation between Swiftmerge Acquisition and Via Renewables

Given the investment horizon of 90 days Swiftmerge Acquisition is expected to generate 8.37 times less return on investment than Via Renewables. But when comparing it to its historical volatility, Swiftmerge Acquisition Corp is 2.68 times less risky than Via Renewables. It trades about 0.01 of its potential returns per unit of risk. Via Renewables is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  1,684  in Via Renewables on September 26, 2024 and sell it today you would earn a total of  656.00  from holding Via Renewables or generate 38.95% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.79%
Values	Daily Returns

Swiftmerge Acquisition Corp  vs.  Via Renewables

Swiftmerge Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Swiftmerge Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable fundamental indicators, Swiftmerge Acquisition is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Via Renewables

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Via Renewables are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, Via Renewables reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Swiftmerge Acquisition and Via Renewables

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

The idea behind Swiftmerge Acquisition Corp and Via Renewables 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.