Correlation Between Bowhead Specialty and Fomo Worldwide

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

By analyzing existing cross correlation between Bowhead Specialty Holdings and Fomo Worldwide, you can compare the effects of market volatilities on Bowhead Specialty and Fomo Worldwide 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 Bowhead Specialty with a short position of Fomo Worldwide. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bowhead Specialty and Fomo Worldwide.

Diversification Opportunities for Bowhead Specialty and Fomo Worldwide

0.0

Correlation Coefficient

Bowhead Specialty  Fomo Worldwide

Pay attention - limited upside

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

Pair Corralation between Bowhead Specialty and Fomo Worldwide

If you would invest (100.00) in Fomo Worldwide on October 10, 2024 and sell it today you would earn a total of  100.00  from holding Fomo Worldwide or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Bowhead Specialty Holdings  vs.  Fomo Worldwide

Bowhead Specialty

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Bowhead Specialty Holdings are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Bowhead Specialty showed solid returns over the last few months and may actually be approaching a breakup point.

Fomo Worldwide

Risk-Adjusted Performance

0 of 100

Solid

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

Pair Trading with Bowhead Specialty and Fomo Worldwide

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

The idea behind Bowhead Specialty Holdings and Fomo Worldwide 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.