Correlation Between Waldencast Acquisition and 10X Capital

Can any of the company-specific risk be diversified away by investing in both Waldencast Acquisition and 10X Capital 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 Waldencast Acquisition and 10X Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Waldencast Acquisition Corp and 10X Capital Venture, you can compare the effects of market volatilities on Waldencast Acquisition and 10X Capital 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 Waldencast Acquisition with a short position of 10X Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Waldencast Acquisition and 10X Capital.

Diversification Opportunities for Waldencast Acquisition and 10X Capital

-0.41

Correlation Coefficient

Waldencast Acquisition  10X Capital

Very good diversification

The 3 months correlation between Waldencast and 10X is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Waldencast Acquisition Corp and 10X Capital Venture in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 10X Capital Venture and Waldencast 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 Waldencast Acquisition Corp are associated (or correlated) with 10X Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 10X Capital Venture has no effect on the direction of Waldencast Acquisition i.e., Waldencast Acquisition and 10X Capital go up and down completely randomly.

Pair Corralation between Waldencast Acquisition and 10X Capital

If you would invest  15.00  in Waldencast Acquisition Corp on October 27, 2024 and sell it today you would lose (1.00) from holding Waldencast Acquisition Corp or give up 6.67% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	1.67%
Values	Daily Returns

Waldencast Acquisition Corp  vs.  10X Capital Venture

Waldencast Acquisition

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Waldencast Acquisition Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady fundamental indicators, Waldencast Acquisition showed solid returns over the last few months and may actually be approaching a breakup point.

10X Capital Venture

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days 10X Capital Venture has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, 10X Capital is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Waldencast Acquisition and 10X Capital

The main advantage of trading using opposite Waldencast Acquisition and 10X Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Waldencast Acquisition position performs unexpectedly, 10X Capital 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 10X Capital will offset losses from the drop in 10X Capital's long position.

The idea behind Waldencast Acquisition Corp and 10X Capital Venture 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.