Correlation Between Nauticus Robotics and Better World

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

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

Diversification Opportunities for Nauticus Robotics and Better World

-0.61

Correlation Coefficient

Nauticus Robotics  Better World

Excellent diversification

The 3 months correlation between Nauticus and Better is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Nauticus Robotics and Better World Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Better World Acquisition and Nauticus Robotics 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 Nauticus Robotics are associated (or correlated) with Better World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Better World Acquisition has no effect on the direction of Nauticus Robotics i.e., Nauticus Robotics and Better World go up and down completely randomly.

Pair Corralation between Nauticus Robotics and Better World

If you would invest  1.12  in Nauticus Robotics on September 28, 2024 and sell it today you would earn a total of  0.85  from holding Nauticus Robotics or generate 75.89% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	5.0%
Values	Daily Returns

Nauticus Robotics  vs.  Better World Acquisition

Nauticus Robotics

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Nauticus Robotics are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, Nauticus Robotics showed solid returns over the last few months and may actually be approaching a breakup point.

Better World Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Nauticus Robotics and Better World

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

The idea behind Nauticus Robotics and Better World Acquisition 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..