Correlation Between Oxbridge Acquisition and OXUSW Old

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

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

Diversification Opportunities for Oxbridge Acquisition and OXUSW Old

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Correlation Coefficient

Oxbridge Acquisition  OXUSW Old

Pay attention - limited upside

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

Pair Corralation between Oxbridge Acquisition and OXUSW Old

Given the investment horizon of 90 days Oxbridge Acquisition is expected to generate 64.36 times less return on investment than OXUSW Old. But when comparing it to its historical volatility, Oxbridge Acquisition Corp is 59.61 times less risky than OXUSW Old. It trades about 0.11 of its potential returns per unit of risk. OXUSW Old is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  5.00  in OXUSW Old on October 12, 2024 and sell it today you would earn a total of  4.00  from holding OXUSW Old or generate 80.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	84.13%
Values	Daily Returns

Oxbridge Acquisition Corp  vs.  OXUSW Old

Oxbridge Acquisition Corp

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Oxbridge Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Oxbridge Acquisition is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

OXUSW Old

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Oxbridge Acquisition and OXUSW Old

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

The idea behind Oxbridge Acquisition Corp and OXUSW Old 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.