Correlation Between Swiftmerge Acquisition and A SPAC

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

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

Diversification Opportunities for Swiftmerge Acquisition and A SPAC

0.31

Correlation Coefficient

Swiftmerge Acquisition  A SPAC

Weak diversification

The 3 months correlation between Swiftmerge and ASCBU is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Swiftmerge Acquisition Corp and A SPAC II in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on A SPAC II and Swiftmerge 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 Swiftmerge Acquisition Corp are associated (or correlated) with A SPAC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of A SPAC II has no effect on the direction of Swiftmerge Acquisition i.e., Swiftmerge Acquisition and A SPAC go up and down completely randomly.

Pair Corralation between Swiftmerge Acquisition and A SPAC

Assuming the 90 days horizon Swiftmerge Acquisition Corp is expected to under-perform the A SPAC. In addition to that, Swiftmerge Acquisition is 1.67 times more volatile than A SPAC II. It trades about -0.01 of its total potential returns per unit of risk. A SPAC II is currently generating about 0.01 per unit of volatility. If you would invest  1,084  in A SPAC II on September 15, 2024 and sell it today you would earn a total of  16.00  from holding A SPAC II or generate 1.48% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	77.82%
Values	Daily Returns

Swiftmerge Acquisition Corp  vs.  A SPAC II

Swiftmerge Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Swiftmerge Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

A SPAC II

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days A SPAC II has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's fundamental drivers remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Swiftmerge Acquisition and A SPAC

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

The idea behind Swiftmerge Acquisition Corp and A SPAC II 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.