Correlation Between Eltek and Altimar Acquisition

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

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

Diversification Opportunities for Eltek and Altimar Acquisition

-0.05

Correlation Coefficient

Eltek  Altimar Acquisition

Good diversification

The 3 months correlation between Eltek and Altimar is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Eltek and Altimar Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altimar Acquisition Corp and Eltek 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 Eltek are associated (or correlated) with Altimar Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altimar Acquisition Corp has no effect on the direction of Eltek i.e., Eltek and Altimar Acquisition go up and down completely randomly.

Pair Corralation between Eltek and Altimar Acquisition

If you would invest  1,080  in Eltek on September 16, 2024 and sell it today you would earn a total of  22.00  from holding Eltek or generate 2.04% return on investment over 90 days.

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

Eltek  vs.  Altimar Acquisition Corp

Eltek

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Eltek are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, Eltek is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

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 recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Eltek and Altimar Acquisition

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

The idea behind Eltek and Altimar 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.