Correlation Between Bolt Projects and Space Communication

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

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

Diversification Opportunities for Bolt Projects and Space Communication

0.0

Correlation Coefficient

Bolt Projects  Space Communication

Pay attention - limited upside

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

Pair Corralation between Bolt Projects and Space Communication

If you would invest  2.00  in Bolt Projects Holdings, on December 20, 2024 and sell it today you would earn a total of  1.99  from holding Bolt Projects Holdings, or generate 99.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	57.14%
Values	Daily Returns

Bolt Projects Holdings,  vs.  Space Communication

Bolt Projects Holdings,

Risk-Adjusted Performance

Good

Over the last 90 days Bolt Projects Holdings, has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly conflicting forward-looking signals, Bolt Projects showed solid returns over the last few months and may actually be approaching a breakup point.

Space Communication

Risk-Adjusted Performance

Very Weak

Over the last 90 days Space Communication has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable primary indicators, Space Communication is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Bolt Projects and Space Communication

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

The idea behind Bolt Projects Holdings, and Space Communication 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.