Correlation Between Altimar Acquisition and Cartesian Growth

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

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

Diversification Opportunities for Altimar Acquisition and Cartesian Growth

0.0

Correlation Coefficient

Altimar Acquisition  Cartesian Growth

Pay attention - limited upside

The 3 months correlation between Altimar and Cartesian is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Altimar Acquisition Corp and Cartesian Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cartesian Growth and Altimar 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 Altimar Acquisition Corp are associated (or correlated) with Cartesian Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cartesian Growth has no effect on the direction of Altimar Acquisition i.e., Altimar Acquisition and Cartesian Growth go up and down completely randomly.

Pair Corralation between Altimar Acquisition and Cartesian Growth

If you would invest  1,140  in Cartesian Growth on September 5, 2024 and sell it today you would earn a total of  24.00  from holding Cartesian Growth or generate 2.11% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

Altimar Acquisition Corp  vs.  Cartesian Growth

Altimar Acquisition Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Altimar Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Altimar Acquisition is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Cartesian Growth

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Cartesian Growth are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Cartesian Growth is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Altimar Acquisition and Cartesian Growth

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

The idea behind Altimar Acquisition Corp and Cartesian Growth 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.