Correlation Between Software Acquisition and Anghami Warrants
Can any of the company-specific risk be diversified away by investing in both Software Acquisition and Anghami Warrants 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 Software Acquisition and Anghami Warrants into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Software Acquisition Group and Anghami Warrants, you can compare the effects of market volatilities on Software Acquisition and Anghami Warrants 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 Software Acquisition with a short position of Anghami Warrants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Software Acquisition and Anghami Warrants.
Diversification Opportunities for Software Acquisition and Anghami Warrants
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Software and Anghami is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Software Acquisition Group and Anghami Warrants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anghami Warrants and Software 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 Software Acquisition Group are associated (or correlated) with Anghami Warrants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anghami Warrants has no effect on the direction of Software Acquisition i.e., Software Acquisition and Anghami Warrants go up and down completely randomly.
Pair Corralation between Software Acquisition and Anghami Warrants
Given the investment horizon of 90 days Software Acquisition Group is expected to under-perform the Anghami Warrants. But the stock apears to be less risky and, when comparing its historical volatility, Software Acquisition Group is 43.8 times less risky than Anghami Warrants. The stock trades about -0.03 of its potential returns per unit of risk. The Anghami Warrants is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 5.51 in Anghami Warrants on July 9, 2024 and sell it today you would lose (3.51) from holding Anghami Warrants or give up 63.7% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 63.98% |
Values | Daily Returns |
Software Acquisition Group vs. Anghami Warrants
Performance |
Timeline |
Software Acquisition |
Anghami Warrants |
Software Acquisition and Anghami Warrants Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Software Acquisition and Anghami Warrants
The main advantage of trading using opposite Software Acquisition and Anghami Warrants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Software Acquisition position performs unexpectedly, Anghami Warrants 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 Anghami Warrants will offset losses from the drop in Anghami Warrants' long position.Software Acquisition vs. Paramount Global Class | Software Acquisition vs. Warner Bros Discovery | Software Acquisition vs. Paramount Global Class |
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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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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