Correlation Between Cartica Acquisition and Bellevue Life

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

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

Diversification Opportunities for Cartica Acquisition and Bellevue Life

-0.07

Correlation Coefficient

Cartica Acquisition  Bellevue Life

Good diversification

The 3 months correlation between Cartica and Bellevue is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Cartica Acquisition Corp and Bellevue Life Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bellevue Life Sciences and Cartica 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 Cartica Acquisition Corp are associated (or correlated) with Bellevue Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bellevue Life Sciences has no effect on the direction of Cartica Acquisition i.e., Cartica Acquisition and Bellevue Life go up and down completely randomly.

Pair Corralation between Cartica Acquisition and Bellevue Life

Assuming the 90 days horizon Cartica Acquisition Corp is expected to under-perform the Bellevue Life. In addition to that, Cartica Acquisition is 14.34 times more volatile than Bellevue Life Sciences. It trades about -0.1 of its total potential returns per unit of risk. Bellevue Life Sciences is currently generating about 0.02 per unit of volatility. If you would invest  1,132  in Bellevue Life Sciences on October 8, 2024 and sell it today you would earn a total of  3.00  from holding Bellevue Life Sciences or generate 0.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	84.21%
Values	Daily Returns

Cartica Acquisition Corp  vs.  Bellevue Life Sciences

Cartica Acquisition Corp

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Cartica Acquisition Corp are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal technical and fundamental indicators, Cartica Acquisition showed solid returns over the last few months and may actually be approaching a breakup point.

Bellevue Life Sciences

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Bellevue Life Sciences are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Bellevue Life is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Cartica Acquisition and Bellevue Life

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

The idea behind Cartica Acquisition Corp and Bellevue Life Sciences 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.