Correlation Between Twelve Seas and TLGY Acquisition

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

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

Diversification Opportunities for Twelve Seas and TLGY Acquisition

0.0

Correlation Coefficient

Twelve Seas  TLGY Acquisition

Pay attention - limited upside

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

Pair Corralation between Twelve Seas and TLGY Acquisition

If you would invest (100.00) in TLGY Acquisition on December 27, 2024 and sell it today you would earn a total of  100.00  from holding TLGY Acquisition 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

Twelve Seas Investment  vs.  TLGY Acquisition

Twelve Seas Investment

Risk-Adjusted Performance

Very Weak

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

TLGY Acquisition

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Twelve Seas and TLGY Acquisition

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

The idea behind Twelve Seas Investment and TLGY Acquisition 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.

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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.