Correlation Between Marblegate Acquisition and FutureTech

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

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

Diversification Opportunities for Marblegate Acquisition and FutureTech

0.21

Correlation Coefficient

Marblegate Acquisition  FutureTech

Modest diversification

The 3 months correlation between Marblegate and FutureTech is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Marblegate Acquisition Corp and FutureTech II Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FutureTech II Acquisition and Marblegate 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 Marblegate Acquisition Corp are associated (or correlated) with FutureTech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FutureTech II Acquisition has no effect on the direction of Marblegate Acquisition i.e., Marblegate Acquisition and FutureTech go up and down completely randomly.

Pair Corralation between Marblegate Acquisition and FutureTech

Assuming the 90 days horizon Marblegate Acquisition Corp is expected to under-perform the FutureTech. But the stock apears to be less risky and, when comparing its historical volatility, Marblegate Acquisition Corp is 9.86 times less risky than FutureTech. The stock trades about -0.02 of its potential returns per unit of risk. The FutureTech II Acquisition is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  3.14  in FutureTech II Acquisition on September 15, 2024 and sell it today you would lose (0.30) from holding FutureTech II Acquisition or give up 9.55% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	40.63%
Values	Daily Returns

Marblegate Acquisition Corp  vs.  FutureTech II Acquisition

Marblegate Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Marblegate Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable technical and fundamental indicators, Marblegate Acquisition is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

FutureTech II Acquisition

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in FutureTech II Acquisition are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal forward indicators, FutureTech showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Marblegate Acquisition and FutureTech

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

The idea behind Marblegate Acquisition Corp and FutureTech II Acquisition 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.