Correlation Between Vulcan Materials and A SPAC

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

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

Diversification Opportunities for Vulcan Materials and A SPAC

0.53

Correlation Coefficient

Vulcan Materials  A SPAC

Very weak diversification

The 3 months correlation between Vulcan and ASPC is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Vulcan Materials and A SPAC III in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on A SPAC III and Vulcan Materials 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 Vulcan Materials are associated (or correlated) with A SPAC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of A SPAC III has no effect on the direction of Vulcan Materials i.e., Vulcan Materials and A SPAC go up and down completely randomly.

Pair Corralation between Vulcan Materials and A SPAC

Considering the 90-day investment horizon Vulcan Materials is expected to generate 12.74 times more return on investment than A SPAC. However, Vulcan Materials is 12.74 times more volatile than A SPAC III. It trades about 0.06 of its potential returns per unit of risk. A SPAC III is currently generating about 0.18 per unit of risk. If you would invest  20,060  in Vulcan Materials on June 18, 2025 and sell it today you would earn a total of  9,136  from holding Vulcan Materials or generate 45.54% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	35.43%
Values	Daily Returns

Vulcan Materials  vs.  A SPAC III

Vulcan Materials

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Vulcan Materials are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak primary indicators, Vulcan Materials exhibited solid returns over the last few months and may actually be approaching a breakup point.

A SPAC III

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in A SPAC III are ranked lower than 14 (%) 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 recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Vulcan Materials and A SPAC

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

The idea behind Vulcan Materials and A SPAC III 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.