Correlation Between Cayson Acquisition and Ispire Technology

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

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

Diversification Opportunities for Cayson Acquisition and Ispire Technology

0.03

Correlation Coefficient

Cayson Acquisition  Ispire Technology

Significant diversification

The 3 months correlation between Cayson and Ispire is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Cayson Acquisition Corp and Ispire Technology Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ispire Technology Common and Cayson 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 Cayson Acquisition Corp are associated (or correlated) with Ispire Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ispire Technology Common has no effect on the direction of Cayson Acquisition i.e., Cayson Acquisition and Ispire Technology go up and down completely randomly.

Pair Corralation between Cayson Acquisition and Ispire Technology

Assuming the 90 days horizon Cayson Acquisition Corp is expected to under-perform the Ispire Technology. But the stock apears to be less risky and, when comparing its historical volatility, Cayson Acquisition Corp is 5.33 times less risky than Ispire Technology. The stock trades about -0.11 of its potential returns per unit of risk. The Ispire Technology Common is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  259.00  in Ispire Technology Common on May 21, 2025 and sell it today you would earn a total of  22.00  from holding Ispire Technology Common or generate 8.49% return on investment over 90 days.

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

Cayson Acquisition Corp  vs.  Ispire Technology Common

Cayson Acquisition Corp

Risk-Adjusted Performance

Weakest

Over the last 90 days Cayson Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Ispire Technology Common

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Ispire Technology Common are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Even with relatively inconsistent basic indicators, Ispire Technology reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Cayson Acquisition and Ispire Technology

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

The idea behind Cayson Acquisition Corp and Ispire Technology Common 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.