Correlation Between Jaws Hurricane and Social Capital

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

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

Diversification Opportunities for Jaws Hurricane and Social Capital

-0.17

Correlation Coefficient

Jaws Hurricane  Social Capital

Good diversification

The 3 months correlation between Jaws and Social is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Jaws Hurricane Acquisition and Social Capital Suvretta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Social Capital Suvretta and Jaws Hurricane 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 Jaws Hurricane Acquisition are associated (or correlated) with Social Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Social Capital Suvretta has no effect on the direction of Jaws Hurricane i.e., Jaws Hurricane and Social Capital go up and down completely randomly.

Pair Corralation between Jaws Hurricane and Social Capital

If you would invest  1,035  in Social Capital Suvretta on September 13, 2024 and sell it today you would earn a total of  0.00  from holding Social Capital Suvretta or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Jaws Hurricane Acquisition  vs.  Social Capital Suvretta

Jaws Hurricane Acqui

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jaws Hurricane Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, Jaws Hurricane is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Social Capital Suvretta

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Jaws Hurricane and Social Capital

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

The idea behind Jaws Hurricane Acquisition and Social Capital Suvretta 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.