Correlation Between Acri Capital and Nubia Brand

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

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

Diversification Opportunities for Acri Capital and Nubia Brand

0.52

Correlation Coefficient

Acri Capital  Nubia Brand

Very weak diversification

The 3 months correlation between Acri and Nubia is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Acri Capital Acquisition and Nubia Brand International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nubia Brand International and Acri Capital 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 Acri Capital Acquisition are associated (or correlated) with Nubia Brand. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nubia Brand International has no effect on the direction of Acri Capital i.e., Acri Capital and Nubia Brand go up and down completely randomly.

Pair Corralation between Acri Capital and Nubia Brand

Given the investment horizon of 90 days Acri Capital Acquisition is expected to generate 8.29 times more return on investment than Nubia Brand. However, Acri Capital is 8.29 times more volatile than Nubia Brand International. It trades about 0.02 of its potential returns per unit of risk. Nubia Brand International is currently generating about 0.13 per unit of risk. If you would invest  1,026  in Acri Capital Acquisition on September 16, 2024 and sell it today you would earn a total of  64.00  from holding Acri Capital Acquisition or generate 6.24% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	32.35%
Values	Daily Returns

Acri Capital Acquisition  vs.  Nubia Brand International

Acri Capital Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Acri Capital Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Nubia Brand International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nubia Brand International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong fundamental drivers, Nubia Brand is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Acri Capital and Nubia Brand

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

The idea behind Acri Capital Acquisition and Nubia Brand International 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.