Correlation Between Melar Acquisition and DMY Squared
Can any of the company-specific risk be diversified away by investing in both Melar Acquisition and DMY Squared 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 Melar Acquisition and DMY Squared into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Melar Acquisition Corp and dMY Squared Technology, you can compare the effects of market volatilities on Melar Acquisition and DMY Squared 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 Melar Acquisition with a short position of DMY Squared. Check out your portfolio center. Please also check ongoing floating volatility patterns of Melar Acquisition and DMY Squared.
Diversification Opportunities for Melar Acquisition and DMY Squared
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Melar and DMY is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Melar Acquisition Corp and dMY Squared Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on dMY Squared Technology and Melar 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 Melar Acquisition Corp are associated (or correlated) with DMY Squared. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of dMY Squared Technology has no effect on the direction of Melar Acquisition i.e., Melar Acquisition and DMY Squared go up and down completely randomly.
Pair Corralation between Melar Acquisition and DMY Squared
Assuming the 90 days horizon Melar Acquisition Corp is expected to generate 12.4 times more return on investment than DMY Squared. However, Melar Acquisition is 12.4 times more volatile than dMY Squared Technology. It trades about 0.1 of its potential returns per unit of risk. dMY Squared Technology is currently generating about 0.09 per unit of risk. If you would invest 11.00 in Melar Acquisition Corp on December 25, 2024 and sell it today you would earn a total of 3.00 from holding Melar Acquisition Corp or generate 27.27% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 72.88% |
Values | Daily Returns |
Melar Acquisition Corp vs. dMY Squared Technology
Performance |
Timeline |
Melar Acquisition Corp |
dMY Squared Technology |
Melar Acquisition and DMY Squared Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Melar Acquisition and DMY Squared
The main advantage of trading using opposite Melar Acquisition and DMY Squared positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Melar Acquisition position performs unexpectedly, DMY Squared 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 DMY Squared will offset losses from the drop in DMY Squared's long position.Melar Acquisition vs. National CineMedia | Melar Acquisition vs. Hertz Global Hldgs | Melar Acquisition vs. Arrow Electronics | Melar Acquisition vs. Lend Lease Group |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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