Correlation Between Gushen and RCF Acquisition

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

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

Diversification Opportunities for Gushen and RCF Acquisition

0.0

Correlation Coefficient

Gushen  RCF Acquisition

Pay attention - limited upside

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

Pair Corralation between Gushen and RCF Acquisition

If you would invest  1,098  in RCF Acquisition Corp on February 11, 2024 and sell it today you would earn a total of  25.00  from holding RCF Acquisition Corp or generate 2.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.59%
Values	Daily Returns

Gushen Inc  vs.  RCF Acquisition Corp

Gushen Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gushen Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical indicators, Gushen is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

RCF Acquisition Corp

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in RCF Acquisition Corp are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong technical and fundamental indicators, RCF Acquisition is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Gushen and RCF Acquisition

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

The idea behind Gushen Inc and RCF Acquisition Corp 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 CEOs Directory module to screen CEOs from public companies around the world.