Correlation Between Mars Acquisition and Proof Acquisition

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

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

Diversification Opportunities for Mars Acquisition and Proof Acquisition

0.0

Correlation Coefficient

Mars Acquisition  Proof Acquisition

Pay attention - limited upside

The 3 months correlation between Mars and Proof is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Mars Acquisition Corp and Proof Acquisition I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Proof Acquisition and Mars 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 Mars Acquisition Corp are associated (or correlated) with Proof Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Proof Acquisition has no effect on the direction of Mars Acquisition i.e., Mars Acquisition and Proof Acquisition go up and down completely randomly.

Pair Corralation between Mars Acquisition and Proof Acquisition

If you would invest  1,111  in Mars Acquisition Corp on September 3, 2024 and sell it today you would earn a total of  12.00  from holding Mars Acquisition Corp or generate 1.08% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

Mars Acquisition Corp  vs.  Proof Acquisition I

Mars Acquisition Corp

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Mars Acquisition Corp are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Mars Acquisition is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Proof Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Proof Acquisition I has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong fundamental indicators, Proof Acquisition is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Mars Acquisition and Proof Acquisition

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

The idea behind Mars Acquisition Corp and Proof Acquisition I 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.