Correlation Between Coliseum Acquisition and Corner Growth

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

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

Diversification Opportunities for Coliseum Acquisition and Corner Growth

-0.33

Correlation Coefficient

Coliseum Acquisition  Corner Growth

Very good diversification

The 3 months correlation between Coliseum and Corner is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Coliseum Acquisition Corp and Corner Growth Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corner Growth Acquisition and Coliseum 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 Coliseum Acquisition Corp are associated (or correlated) with Corner Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corner Growth Acquisition has no effect on the direction of Coliseum Acquisition i.e., Coliseum Acquisition and Corner Growth go up and down completely randomly.

Pair Corralation between Coliseum Acquisition and Corner Growth

If you would invest  17.00  in Coliseum Acquisition Corp on September 18, 2024 and sell it today you would lose (8.00) from holding Coliseum Acquisition Corp or give up 47.06% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Coliseum Acquisition Corp  vs.  Corner Growth Acquisition

Coliseum Acquisition Corp

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Coliseum Acquisition Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Coliseum Acquisition showed solid returns over the last few months and may actually be approaching a breakup point.

Corner Growth Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Corner Growth Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Corner Growth is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Coliseum Acquisition and Corner Growth

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

The idea behind Coliseum Acquisition Corp and Corner Growth Acquisition 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.