Correlation Between Vine Hill and Cohen Circle

Can any of the company-specific risk be diversified away by investing in both Vine Hill and Cohen Circle 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 Cohen Circle 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 Cohen Circle Acquisition, you can compare the effects of market volatilities on Vine Hill and Cohen Circle 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 Cohen Circle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vine Hill and Cohen Circle.

Diversification Opportunities for Vine Hill and Cohen Circle

0.5

Correlation Coefficient

Vine Hill  Cohen Circle

Very weak diversification

The 3 months correlation between Vine and Cohen is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Vine Hill Capital and Cohen Circle Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cohen Circle 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 Cohen Circle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cohen Circle Acquisition has no effect on the direction of Vine Hill i.e., Vine Hill and Cohen Circle go up and down completely randomly.

Pair Corralation between Vine Hill and Cohen Circle

Given the investment horizon of 90 days Vine Hill is expected to generate 6.08 times less return on investment than Cohen Circle. But when comparing it to its historical volatility, Vine Hill Capital is 3.58 times less risky than Cohen Circle. It trades about 0.15 of its potential returns per unit of risk. Cohen Circle Acquisition is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest  1,000.00  in Cohen Circle Acquisition on October 26, 2024 and sell it today you would earn a total of  55.81  from holding Cohen Circle Acquisition or generate 5.58% return on investment over 90 days.

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

Vine Hill Capital  vs.  Cohen Circle Acquisition

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.

Cohen Circle Acquisition

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Cohen Circle Acquisition are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Cohen Circle is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Vine Hill and Cohen Circle

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

The idea behind Vine Hill Capital and Cohen Circle 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.

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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.