Correlation Between Arbe Robotics and Nauticus Robotics

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

By analyzing existing cross correlation between Arbe Robotics Ltd and Nauticus Robotics, you can compare the effects of market volatilities on Arbe Robotics and Nauticus Robotics 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 Arbe Robotics with a short position of Nauticus Robotics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arbe Robotics and Nauticus Robotics.

Diversification Opportunities for Arbe Robotics and Nauticus Robotics

0.61

Correlation Coefficient

Arbe Robotics  Nauticus Robotics

Poor diversification

The 3 months correlation between Arbe and Nauticus is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Arbe Robotics Ltd and Nauticus Robotics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nauticus Robotics and Arbe Robotics 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 Arbe Robotics Ltd are associated (or correlated) with Nauticus Robotics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nauticus Robotics has no effect on the direction of Arbe Robotics i.e., Arbe Robotics and Nauticus Robotics go up and down completely randomly.

Pair Corralation between Arbe Robotics and Nauticus Robotics

Assuming the 90 days horizon Arbe Robotics Ltd is expected to generate 9.53 times more return on investment than Nauticus Robotics. However, Arbe Robotics is 9.53 times more volatile than Nauticus Robotics. It trades about 0.08 of its potential returns per unit of risk. Nauticus Robotics is currently generating about -0.06 per unit of risk. If you would invest  39.00  in Arbe Robotics Ltd on October 5, 2024 and sell it today you would lose (13.80) from holding Arbe Robotics Ltd or give up 35.38% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	92.12%
Values	Daily Returns

Arbe Robotics Ltd  vs.  Nauticus Robotics

Arbe Robotics

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Arbe Robotics Ltd are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain technical and fundamental indicators, Arbe Robotics showed solid returns over the last few months and may actually be approaching a breakup point.

Nauticus Robotics

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Nauticus Robotics are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Nauticus Robotics unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Arbe Robotics and Nauticus Robotics

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

The idea behind Arbe Robotics Ltd and Nauticus Robotics 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.