Correlation Between Vine Hill and Centurion Acquisition

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

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

Diversification Opportunities for Vine Hill and Centurion Acquisition

-0.13

Correlation Coefficient

Vine Hill  Centurion Acquisition

Good diversification

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

Pair Corralation between Vine Hill and Centurion Acquisition

Given the investment horizon of 90 days Vine Hill Capital is expected to generate 0.0 times more return on investment than Centurion Acquisition. However, Vine Hill Capital is 231.11 times less risky than Centurion Acquisition. It trades about 0.1 of its potential returns per unit of risk. Centurion Acquisition Corp is currently generating about -0.22 per unit of risk. If you would invest  999.00  in Vine Hill Capital on September 24, 2024 and sell it today you would earn a total of  2.00  from holding Vine Hill Capital or generate 0.2% return on investment over 90 days.

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

Vine Hill Capital  vs.  Centurion Acquisition Corp

Vine Hill Capital

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Vine Hill Capital are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound forward indicators, Vine Hill is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Centurion Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Centurion Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's essential indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Vine Hill and Centurion Acquisition

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

The idea behind Vine Hill Capital and Centurion Acquisition 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.