Correlation Between Nauticus Robotics and USA Recycling

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

By analyzing existing cross correlation between Nauticus Robotics and USA Recycling Industries, you can compare the effects of market volatilities on Nauticus Robotics and USA Recycling 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 USA Recycling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nauticus Robotics and USA Recycling.

Diversification Opportunities for Nauticus Robotics and USA Recycling

-0.44

Correlation Coefficient

Nauticus Robotics  USA Recycling

Very good diversification

The 3 months correlation between Nauticus and USA is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Nauticus Robotics and USA Recycling Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on USA Recycling Industries 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 USA Recycling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of USA Recycling Industries has no effect on the direction of Nauticus Robotics i.e., Nauticus Robotics and USA Recycling go up and down completely randomly.

Pair Corralation between Nauticus Robotics and USA Recycling

Assuming the 90 days horizon Nauticus Robotics is expected to generate 4.04 times more return on investment than USA Recycling. However, Nauticus Robotics is 4.04 times more volatile than USA Recycling Industries. It trades about 0.08 of its potential returns per unit of risk. USA Recycling Industries is currently generating about -0.02 per unit of risk. If you would invest  25.00  in Nauticus Robotics on October 13, 2024 and sell it today you would lose (8.00) from holding Nauticus Robotics or give up 32.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	78.92%
Values	Daily Returns

Nauticus Robotics  vs.  USA Recycling Industries

Nauticus Robotics

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Nauticus Robotics are ranked lower than 16 (%) 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.

USA Recycling Industries

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days USA Recycling Industries has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Nauticus Robotics and USA Recycling

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

The idea behind Nauticus Robotics and USA Recycling Industries 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..