Correlation Between Tastemaker Acquisition and GPAC Old

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

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

Diversification Opportunities for Tastemaker Acquisition and GPAC Old

0.0

Correlation Coefficient

Tastemaker Acquisition  GPAC Old

Pay attention - limited upside

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

Pair Corralation between Tastemaker Acquisition and GPAC Old

If you would invest (100.00) in GPAC Old on December 3, 2024 and sell it today you would earn a total of  100.00  from holding GPAC Old or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Tastemaker Acquisition Corp  vs.  GPAC Old

Tastemaker Acquisition

Risk-Adjusted Performance

Very Weak

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

GPAC Old

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Tastemaker Acquisition and GPAC Old

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

The idea behind Tastemaker Acquisition Corp and GPAC 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.