Correlation Between Bowen Acquisition and Humatech

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

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

Diversification Opportunities for Bowen Acquisition and Humatech

0.56

Correlation Coefficient

Bowen Acquisition  Humatech

Very weak diversification

The 3 months correlation between Bowen and Humatech is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Bowen Acquisition Corp and Humatech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Humatech and Bowen Acquisition 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 Bowen Acquisition Corp are associated (or correlated) with Humatech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Humatech has no effect on the direction of Bowen Acquisition i.e., Bowen Acquisition and Humatech go up and down completely randomly.

Pair Corralation between Bowen Acquisition and Humatech

Given the investment horizon of 90 days Bowen Acquisition Corp is expected to under-perform the Humatech. But the stock apears to be less risky and, when comparing its historical volatility, Bowen Acquisition Corp is 15.45 times less risky than Humatech. The stock trades about -0.02 of its potential returns per unit of risk. The Humatech is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  0.01  in Humatech on December 20, 2024 and sell it today you would earn a total of  0.00  from holding Humatech or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.16%
Values	Daily Returns

Bowen Acquisition Corp  vs.  Humatech

Bowen Acquisition Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bowen Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Humatech

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Humatech are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain primary indicators, Humatech unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Bowen Acquisition and Humatech

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

The idea behind Bowen Acquisition Corp and Humatech 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.