Correlation Between Blue World and WinVest Acquisition
Can any of the company-specific risk be diversified away by investing in both Blue World and WinVest 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 Blue World and WinVest Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blue World Acquisition and WinVest Acquisition Corp, you can compare the effects of market volatilities on Blue World and WinVest 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 Blue World with a short position of WinVest Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blue World and WinVest Acquisition.
Diversification Opportunities for Blue World and WinVest Acquisition
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Blue and WinVest is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Blue World Acquisition and WinVest Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WinVest Acquisition Corp and Blue World 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 Blue World Acquisition are associated (or correlated) with WinVest Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WinVest Acquisition Corp has no effect on the direction of Blue World i.e., Blue World and WinVest Acquisition go up and down completely randomly.
Pair Corralation between Blue World and WinVest Acquisition
Assuming the 90 days horizon Blue World is expected to generate 1.57 times less return on investment than WinVest Acquisition. But when comparing it to its historical volatility, Blue World Acquisition is 1.28 times less risky than WinVest Acquisition. It trades about 0.12 of its potential returns per unit of risk. WinVest Acquisition Corp is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 6.65 in WinVest Acquisition Corp on September 4, 2024 and sell it today you would earn a total of 2.81 from holding WinVest Acquisition Corp or generate 42.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 55.29% |
| Values | Daily Returns |
Blue World Acquisition vs. WinVest Acquisition Corp
Performance |
| Timeline |
| Blue World Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| WinVest Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Blue World and WinVest Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blue World and WinVest Acquisition
The main advantage of trading using opposite Blue World and WinVest Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue World position performs unexpectedly, WinVest 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 WinVest Acquisition will offset losses from the drop in WinVest Acquisition's long position.The idea behind Blue World Acquisition and WinVest 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.| WinVest Acquisition vs. Kairous Acquisition Corp | WinVest Acquisition vs. Aquagold International | WinVest Acquisition vs. Morningstar Unconstrained Allocation | WinVest Acquisition vs. Thrivent High Yield |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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