Correlation Between NewHold Investment and Greencity Acquisition
Can any of the company-specific risk be diversified away by investing in both NewHold Investment and Greencity 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 NewHold Investment and Greencity Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NewHold Investment Corp and Greencity Acquisition, you can compare the effects of market volatilities on NewHold Investment and Greencity 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 NewHold Investment with a short position of Greencity Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of NewHold Investment and Greencity Acquisition.
Diversification Opportunities for NewHold Investment and Greencity Acquisition
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between NewHold and Greencity is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding NewHold Investment Corp and Greencity Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greencity Acquisition and NewHold Investment 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 NewHold Investment Corp are associated (or correlated) with Greencity Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greencity Acquisition has no effect on the direction of NewHold Investment i.e., NewHold Investment and Greencity Acquisition go up and down completely randomly.
Pair Corralation between NewHold Investment and Greencity Acquisition
If you would invest 1.62 in Greencity Acquisition on September 6, 2024 and sell it today you would earn a total of 0.00 from holding Greencity Acquisition or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
NewHold Investment Corp vs. Greencity Acquisition
Performance |
Timeline |
NewHold Investment Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Greencity Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
NewHold Investment and Greencity Acquisition Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with NewHold Investment and Greencity Acquisition
The main advantage of trading using opposite NewHold Investment and Greencity Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NewHold Investment position performs unexpectedly, Greencity 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 Greencity Acquisition will offset losses from the drop in Greencity Acquisition's long position.NewHold Investment vs. Inflection Point Acquisition | NewHold Investment vs. TFI International | NewHold Investment vs. Summit Materials | NewHold Investment vs. Lion One Metals |
Check out your portfolio center.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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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