Correlation Between Waldencast Acquisition and Park Ha

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

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

Diversification Opportunities for Waldencast Acquisition and Park Ha

-0.53

Correlation Coefficient

Waldencast Acquisition  Park Ha

Excellent diversification

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

Pair Corralation between Waldencast Acquisition and Park Ha

Assuming the 90 days horizon Waldencast Acquisition is expected to generate 12.52 times less return on investment than Park Ha. In addition to that, Waldencast Acquisition is 1.06 times more volatile than Park Ha Biological. It trades about 0.01 of its total potential returns per unit of risk. Park Ha Biological is currently generating about 0.19 per unit of volatility. If you would invest  553.00  in Park Ha Biological on January 13, 2025 and sell it today you would earn a total of  733.00  from holding Park Ha Biological or generate 132.55% return on investment over 90 days.

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

Waldencast Acquisition Corp  vs.  Park Ha Biological

Waldencast Acquisition

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Waldencast Acquisition Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady fundamental indicators, Waldencast Acquisition may actually be approaching a critical reversion point that can send shares even higher in May 2025.

Park Ha Biological

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Park Ha Biological are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating technical indicators, Park Ha demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Waldencast Acquisition and Park Ha

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

The idea behind Waldencast Acquisition Corp and Park Ha Biological 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.