Correlation Between XPAC Acquisition and Bilander Acquisition

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

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

Diversification Opportunities for XPAC Acquisition and Bilander Acquisition

0.66

Correlation Coefficient

XPAC Acquisition  Bilander Acquisition

Poor diversification

The 3 months correlation between XPAC and Bilander is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding XPAC Acquisition Corp and Bilander Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bilander Acquisition Corp and XPAC 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 XPAC Acquisition Corp are associated (or correlated) with Bilander Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bilander Acquisition Corp has no effect on the direction of XPAC Acquisition i.e., XPAC Acquisition and Bilander Acquisition go up and down completely randomly.

Pair Corralation between XPAC Acquisition and Bilander Acquisition

If you would invest  1,024  in Bilander Acquisition Corp on September 17, 2024 and sell it today you would earn a total of  0.00  from holding Bilander Acquisition Corp or generate 0.0% return on investment over 90 days.

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

XPAC Acquisition Corp  vs.  Bilander Acquisition Corp

XPAC Acquisition Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Bilander Acquisition Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bilander Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental indicators, Bilander Acquisition is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with XPAC Acquisition and Bilander Acquisition

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

The idea behind XPAC Acquisition Corp and Bilander 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.