Correlation Between A SPAC and Spark I

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

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

Diversification Opportunities for A SPAC and Spark I

-0.26

Correlation Coefficient

A SPAC  Spark I

Very good diversification

The 3 months correlation between ASPC and Spark is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding A SPAC III and Spark I Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spark I Acquisition and A SPAC 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 A SPAC III are associated (or correlated) with Spark I. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spark I Acquisition has no effect on the direction of A SPAC i.e., A SPAC and Spark I go up and down completely randomly.

Pair Corralation between A SPAC and Spark I

Given the investment horizon of 90 days A SPAC III is expected to generate 1.4 times more return on investment than Spark I. However, A SPAC is 1.4 times more volatile than Spark I Acquisition. It trades about 0.03 of its potential returns per unit of risk. Spark I Acquisition is currently generating about 0.03 per unit of risk. If you would invest  1,030  in A SPAC III on September 9, 2025 and sell it today you would earn a total of  22.00  from holding A SPAC III or generate 2.14% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

A SPAC III  vs.  Spark I Acquisition

A SPAC III

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in A SPAC III are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, A SPAC is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Spark I Acquisition

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Spark I Acquisition are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent forward-looking signals, Spark I is not utilizing all of its potentials. The newest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with A SPAC and Spark I

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

The idea behind A SPAC III and Spark I 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.