Correlation Between Trimax Corp and LatAmGrowth SPAC

Can any of the company-specific risk be diversified away by investing in both Trimax Corp and LatAmGrowth SPAC 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 Trimax Corp and LatAmGrowth SPAC into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Trimax Corp and LatAmGrowth SPAC

0.13

Correlation Coefficient

Trimax Corp  LatAmGrowth SPAC

Average diversification

The 3 months correlation between Trimax and LatAmGrowth is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Trimax Corp and LatAmGrowth SPAC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LatAmGrowth SPAC and Trimax Corp 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 Trimax Corp are associated (or correlated) with LatAmGrowth SPAC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LatAmGrowth SPAC has no effect on the direction of Trimax Corp i.e., Trimax Corp and LatAmGrowth SPAC go up and down completely randomly.

Pair Corralation between Trimax Corp and LatAmGrowth SPAC

Given the investment horizon of 90 days Trimax Corp is expected to generate 4.43 times more return on investment than LatAmGrowth SPAC. However, Trimax Corp is 4.43 times more volatile than LatAmGrowth SPAC. It trades about 0.09 of its potential returns per unit of risk. LatAmGrowth SPAC is currently generating about -0.04 per unit of risk. If you would invest  0.11  in Trimax Corp on October 9, 2024 and sell it today you would earn a total of  0.02  from holding Trimax Corp or generate 18.18% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

Trimax Corp  vs.  LatAmGrowth SPAC

Trimax Corp

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Trimax Corp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Trimax Corp displayed solid returns over the last few months and may actually be approaching a breakup point.

LatAmGrowth SPAC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days LatAmGrowth SPAC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Trimax Corp and LatAmGrowth SPAC

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

The idea behind Trimax Corp and LatAmGrowth SPAC 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.