Correlation Between ExcelFin Acquisition and Integral Acquisition

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

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

Diversification Opportunities for ExcelFin Acquisition and Integral Acquisition

0.18

Correlation Coefficient

ExcelFin Acquisition  Integral Acquisition

Average diversification

The 3 months correlation between ExcelFin and Integral is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding ExcelFin Acquisition Corp and Integral Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Integral Acquisition and ExcelFin 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 ExcelFin Acquisition Corp are associated (or correlated) with Integral Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Integral Acquisition has no effect on the direction of ExcelFin Acquisition i.e., ExcelFin Acquisition and Integral Acquisition go up and down completely randomly.

Pair Corralation between ExcelFin Acquisition and Integral Acquisition

Assuming the 90 days horizon ExcelFin Acquisition Corp is expected to generate 1.48 times more return on investment than Integral Acquisition. However, ExcelFin Acquisition is 1.48 times more volatile than Integral Acquisition. It trades about 0.36 of its potential returns per unit of risk. Integral Acquisition is currently generating about -0.22 per unit of risk. If you would invest  3.50  in ExcelFin Acquisition Corp on September 15, 2024 and sell it today you would earn a total of  3.50  from holding ExcelFin Acquisition Corp or generate 100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	60.0%
Values	Daily Returns

ExcelFin Acquisition Corp  vs.  Integral Acquisition

ExcelFin Acquisition Corp

Risk-Adjusted Performance

0 of 100

Strong

Over the last 90 days ExcelFin Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly abnormal basic indicators, ExcelFin Acquisition showed solid returns over the last few months and may actually be approaching a breakup point.

Integral Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Integral Acquisition 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 technical and fundamental indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with ExcelFin Acquisition and Integral Acquisition

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

The idea behind ExcelFin Acquisition Corp and Integral 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.

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 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.