Correlation Between Bleuacacia and Marblegate Acquisition

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

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

Diversification Opportunities for Bleuacacia and Marblegate Acquisition

0.09

Correlation Coefficient

Bleuacacia  Marblegate Acquisition

Significant diversification

The 3 months correlation between Bleuacacia and Marblegate is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Bleuacacia and Marblegate Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marblegate Acquisition and Bleuacacia 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 Bleuacacia are associated (or correlated) with Marblegate Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marblegate Acquisition has no effect on the direction of Bleuacacia i.e., Bleuacacia and Marblegate Acquisition go up and down completely randomly.

Pair Corralation between Bleuacacia and Marblegate Acquisition

Given the investment horizon of 90 days Bleuacacia is expected to generate 1.51 times more return on investment than Marblegate Acquisition. However, Bleuacacia is 1.51 times more volatile than Marblegate Acquisition Corp. It trades about 0.03 of its potential returns per unit of risk. Marblegate Acquisition Corp is currently generating about 0.04 per unit of risk. If you would invest  1,011  in Bleuacacia on October 11, 2024 and sell it today you would earn a total of  92.00  from holding Bleuacacia or generate 9.1% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	94.15%
Values	Daily Returns

Bleuacacia  vs.  Marblegate Acquisition Corp

Bleuacacia

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Bleuacacia has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, Bleuacacia is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Marblegate Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Marblegate Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Marblegate Acquisition is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Bleuacacia and Marblegate Acquisition

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

The idea behind Bleuacacia and Marblegate 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.