Correlation Between Boeing and Knightswan Acquisition

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

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

Diversification Opportunities for Boeing and Knightswan Acquisition

-0.49

Correlation Coefficient

Boeing  Knightswan Acquisition

Very good diversification

The 3 months correlation between Boeing and Knightswan is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding The Boeing and Knightswan Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Knightswan Acquisition and Boeing 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 The Boeing are associated (or correlated) with Knightswan Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Knightswan Acquisition has no effect on the direction of Boeing i.e., Boeing and Knightswan Acquisition go up and down completely randomly.

Pair Corralation between Boeing and Knightswan Acquisition

If you would invest  15,639  in The Boeing on September 17, 2024 and sell it today you would earn a total of  1,326  from holding The Boeing or generate 8.48% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	1.54%
Values	Daily Returns

The Boeing  vs.  Knightswan Acquisition Corp

Boeing

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in The Boeing are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Boeing may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Knightswan Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Knightswan Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Knightswan Acquisition 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 Boeing and Knightswan Acquisition

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

The idea behind The Boeing and Knightswan 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.