Correlation Between Software Acquisition and Madison Square

Can any of the company-specific risk be diversified away by investing in both Software Acquisition and Madison Square 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 Madison Square 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 Madison Square Garden, you can compare the effects of market volatilities on Software Acquisition and Madison Square 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 Madison Square. Check out your portfolio center. Please also check ongoing floating volatility patterns of Software Acquisition and Madison Square.

Diversification Opportunities for Software Acquisition and Madison Square

0.0

Correlation Coefficient

Software Acquisition  Madison Square

Pay attention - limited upside

The 3 months correlation between Software and Madison is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Software Acquisition Group and Madison Square Garden in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Madison Square Garden 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 Madison Square. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Madison Square Garden has no effect on the direction of Software Acquisition i.e., Software Acquisition and Madison Square go up and down completely randomly.

Pair Corralation between Software Acquisition and Madison Square

If you would invest  19,031  in Madison Square Garden on May 7, 2025 and sell it today you would earn a total of  1,204  from holding Madison Square Garden or generate 6.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.61%
Values	Daily Returns

Software Acquisition Group  vs.  Madison Square Garden

Software Acquisition

Risk-Adjusted Performance

Weakest

Over the last 90 days Software Acquisition Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable technical and fundamental indicators, Software Acquisition is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Madison Square Garden

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Madison Square Garden are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting technical and fundamental indicators, Madison Square may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Software Acquisition and Madison Square

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

The idea behind Software Acquisition Group and Madison Square Garden 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.