Correlation Between CaliberCos and Bowen Acquisition

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

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

Diversification Opportunities for CaliberCos and Bowen Acquisition

0.38

Correlation Coefficient

CaliberCos  Bowen Acquisition

Weak diversification

The 3 months correlation between CaliberCos and Bowen is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding CaliberCos Class A and Bowen Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bowen Acquisition Corp and CaliberCos 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 CaliberCos Class A are associated (or correlated) with Bowen Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bowen Acquisition Corp has no effect on the direction of CaliberCos i.e., CaliberCos and Bowen Acquisition go up and down completely randomly.

Pair Corralation between CaliberCos and Bowen Acquisition

Considering the 90-day investment horizon CaliberCos Class A is expected to generate 0.49 times more return on investment than Bowen Acquisition. However, CaliberCos Class A is 2.04 times less risky than Bowen Acquisition. It trades about 0.09 of its potential returns per unit of risk. Bowen Acquisition Corp is currently generating about -0.01 per unit of risk. If you would invest  53.00  in CaliberCos Class A on December 21, 2024 and sell it today you would earn a total of  12.00  from holding CaliberCos Class A or generate 22.64% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

CaliberCos Class A  vs.  Bowen Acquisition Corp

CaliberCos Class A

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in CaliberCos Class A are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent basic indicators, CaliberCos exhibited solid returns over the last few months and may actually be approaching a breakup point.

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 latest unsteady performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with CaliberCos and Bowen Acquisition

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

The idea behind CaliberCos Class A and Bowen 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.