Correlation Between Bullfrog and Caduceus Software

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

By analyzing existing cross correlation between Bullfrog AI Holdings, and Caduceus Software Systems, you can compare the effects of market volatilities on Bullfrog and Caduceus Software 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 Bullfrog with a short position of Caduceus Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bullfrog and Caduceus Software.

Diversification Opportunities for Bullfrog and Caduceus Software

0.51

Correlation Coefficient

Bullfrog  Caduceus Software

Very weak diversification

The 3 months correlation between Bullfrog and Caduceus is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Bullfrog AI Holdings, and Caduceus Software Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caduceus Software Systems and Bullfrog 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 Bullfrog AI Holdings, are associated (or correlated) with Caduceus Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caduceus Software Systems has no effect on the direction of Bullfrog i.e., Bullfrog and Caduceus Software go up and down completely randomly.

Pair Corralation between Bullfrog and Caduceus Software

Given the investment horizon of 90 days Bullfrog AI Holdings, is expected to under-perform the Caduceus Software. But the stock apears to be less risky and, when comparing its historical volatility, Bullfrog AI Holdings, is 2.17 times less risky than Caduceus Software. The stock trades about -0.01 of its potential returns per unit of risk. The Caduceus Software Systems is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  0.55  in Caduceus Software Systems on December 30, 2024 and sell it today you would earn a total of  0.05  from holding Caduceus Software Systems or generate 9.09% return on investment over 90 days.

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

Bullfrog AI Holdings,  vs.  Caduceus Software Systems

Bullfrog AI Holdings,

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bullfrog AI Holdings, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Caduceus Software Systems

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Caduceus Software Systems are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, Caduceus Software exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Bullfrog and Caduceus Software

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

The idea behind Bullfrog AI Holdings, and Caduceus Software Systems 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.