Correlation Between PowerUp Acquisition and Nexpoint Real
Can any of the company-specific risk be diversified away by investing in both PowerUp Acquisition and Nexpoint Real 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 PowerUp Acquisition and Nexpoint Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PowerUp Acquisition Corp and Nexpoint Real Estate, you can compare the effects of market volatilities on PowerUp Acquisition and Nexpoint Real 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 PowerUp Acquisition with a short position of Nexpoint Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of PowerUp Acquisition and Nexpoint Real.
Diversification Opportunities for PowerUp Acquisition and Nexpoint Real
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PowerUp and Nexpoint is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding PowerUp Acquisition Corp and Nexpoint Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nexpoint Real Estate and PowerUp 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 PowerUp Acquisition Corp are associated (or correlated) with Nexpoint Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nexpoint Real Estate has no effect on the direction of PowerUp Acquisition i.e., PowerUp Acquisition and Nexpoint Real go up and down completely randomly.
Pair Corralation between PowerUp Acquisition and Nexpoint Real
Assuming the 90 days horizon PowerUp Acquisition is expected to generate 57.55 times less return on investment than Nexpoint Real. But when comparing it to its historical volatility, PowerUp Acquisition Corp is 16.96 times less risky than Nexpoint Real. It trades about 0.12 of its potential returns per unit of risk. Nexpoint Real Estate is currently generating about 0.41 of returns per unit of risk over similar time horizon. If you would invest 1,486 in Nexpoint Real Estate on September 6, 2024 and sell it today you would earn a total of 238.00 from holding Nexpoint Real Estate or generate 16.02% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
PowerUp Acquisition Corp vs. Nexpoint Real Estate
Performance |
Timeline |
PowerUp Acquisition Corp |
Nexpoint Real Estate |
PowerUp Acquisition and Nexpoint Real Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with PowerUp Acquisition and Nexpoint Real
The main advantage of trading using opposite PowerUp Acquisition and Nexpoint Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PowerUp Acquisition position performs unexpectedly, Nexpoint Real 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 Nexpoint Real will offset losses from the drop in Nexpoint Real's long position.PowerUp Acquisition vs. Asure Software | PowerUp Acquisition vs. Marine Products | PowerUp Acquisition vs. Usio Inc | PowerUp Acquisition vs. Western Digital |
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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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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