Correlation Between Plutonian Acquisition and Catcha Investment

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

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

Diversification Opportunities for Plutonian Acquisition and Catcha Investment

-0.89

Correlation Coefficient

Plutonian Acquisition  Catcha Investment

Pay attention - limited upside

The 3 months correlation between Plutonian and Catcha is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding Plutonian Acquisition Corp and Catcha Investment Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catcha Investment Corp and Plutonian 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 Plutonian Acquisition Corp are associated (or correlated) with Catcha Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catcha Investment Corp has no effect on the direction of Plutonian Acquisition i.e., Plutonian Acquisition and Catcha Investment go up and down completely randomly.

Pair Corralation between Plutonian Acquisition and Catcha Investment

Assuming the 90 days horizon Plutonian Acquisition Corp is expected to generate 0.14 times more return on investment than Catcha Investment. However, Plutonian Acquisition Corp is 7.0 times less risky than Catcha Investment. It trades about 0.08 of its potential returns per unit of risk. Catcha Investment Corp is currently generating about 0.01 per unit of risk. If you would invest  1,007  in Plutonian Acquisition Corp on September 5, 2024 and sell it today you would earn a total of  61.00  from holding Plutonian Acquisition Corp or generate 6.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	41.27%
Values	Daily Returns

Plutonian Acquisition Corp  vs.  Catcha Investment Corp

Plutonian Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Plutonian Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Plutonian Acquisition is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Catcha Investment Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Catcha Investment Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Catcha Investment is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Plutonian Acquisition and Catcha Investment

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

The idea behind Plutonian Acquisition Corp and Catcha Investment Corp 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.