Correlation Between Concord Acquisition and Genesis Unicorn

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

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

Diversification Opportunities for Concord Acquisition and Genesis Unicorn

0.03

Correlation Coefficient

Concord Acquisition  Genesis Unicorn

Significant diversification

The 3 months correlation between Concord and Genesis is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Concord Acquisition Corp and Genesis Unicorn Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genesis Unicorn Capital and Concord 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 Concord Acquisition Corp are associated (or correlated) with Genesis Unicorn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genesis Unicorn Capital has no effect on the direction of Concord Acquisition i.e., Concord Acquisition and Genesis Unicorn go up and down completely randomly.

Pair Corralation between Concord Acquisition and Genesis Unicorn

If you would invest  1,053  in Concord Acquisition Corp on September 28, 2024 and sell it today you would lose (1,053) from holding Concord Acquisition Corp or give up 100.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	5.0%
Values	Daily Returns

Concord Acquisition Corp  vs.  Genesis Unicorn Capital

Concord Acquisition Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Genesis Unicorn Capital

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Genesis Unicorn Capital has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Genesis Unicorn is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Concord Acquisition and Genesis Unicorn

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

The idea behind Concord Acquisition Corp and Genesis Unicorn Capital 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.