Correlation Between PowerUp Acquisition and Bancroft Fund

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

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

Diversification Opportunities for PowerUp Acquisition and Bancroft Fund

-0.31

Correlation Coefficient

PowerUp Acquisition  Bancroft Fund

Very good diversification

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

Pair Corralation between PowerUp Acquisition and Bancroft Fund

Assuming the 90 days horizon PowerUp Acquisition Corp is expected to under-perform the Bancroft Fund. In addition to that, PowerUp Acquisition is 31.78 times more volatile than Bancroft Fund Limited. It trades about -0.06 of its total potential returns per unit of risk. Bancroft Fund Limited is currently generating about 0.37 per unit of volatility. If you would invest  1,564  in Bancroft Fund Limited on September 1, 2024 and sell it today you would earn a total of  275.00  from holding Bancroft Fund Limited or generate 17.58% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	49.21%
Values	Daily Returns

PowerUp Acquisition Corp  vs.  Bancroft Fund Limited

PowerUp Acquisition Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PowerUp Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in December 2024. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Bancroft Fund Limited

Risk-Adjusted Performance

29 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Bancroft Fund Limited are ranked lower than 29 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain fundamental indicators, Bancroft Fund showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PowerUp Acquisition and Bancroft Fund

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

The idea behind PowerUp Acquisition Corp and Bancroft Fund Limited 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.