Correlation Between Swiftmerge Acquisition and Iconic Sports

Can any of the company-specific risk be diversified away by investing in both Swiftmerge Acquisition and Iconic Sports 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 Iconic Sports 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 Iconic Sports Acquisition, you can compare the effects of market volatilities on Swiftmerge Acquisition and Iconic Sports 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 Iconic Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swiftmerge Acquisition and Iconic Sports.

Diversification Opportunities for Swiftmerge Acquisition and Iconic Sports

-0.15

Correlation Coefficient

Swiftmerge Acquisition  Iconic Sports

Good diversification

The 3 months correlation between Swiftmerge and Iconic is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Swiftmerge Acquisition Corp and Iconic Sports Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iconic Sports Acquisition 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 Iconic Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iconic Sports Acquisition has no effect on the direction of Swiftmerge Acquisition i.e., Swiftmerge Acquisition and Iconic Sports go up and down completely randomly.

Pair Corralation between Swiftmerge Acquisition and Iconic Sports

Assuming the 90 days horizon Swiftmerge Acquisition is expected to generate 22.0 times less return on investment than Iconic Sports. In addition to that, Swiftmerge Acquisition is 24.61 times more volatile than Iconic Sports Acquisition. It trades about 0.0 of its total potential returns per unit of risk. Iconic Sports Acquisition is currently generating about 0.33 per unit of volatility. If you would invest  1,035  in Iconic Sports Acquisition on September 26, 2024 and sell it today you would earn a total of  38.00  from holding Iconic Sports Acquisition or generate 3.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	27.96%
Values	Daily Returns

Swiftmerge Acquisition Corp  vs.  Iconic Sports Acquisition

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 uncertain performance in the last few months, the Stock's basic indicators 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.

Iconic Sports Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Iconic Sports Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Iconic Sports is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Swiftmerge Acquisition and Iconic Sports

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

The idea behind Swiftmerge Acquisition Corp and Iconic Sports 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.