Correlation Between WinVest Acquisition and Bleuacacia

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

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

Diversification Opportunities for WinVest Acquisition and Bleuacacia

-0.07

Correlation Coefficient

WinVest Acquisition  Bleuacacia

Good diversification

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

Pair Corralation between WinVest Acquisition and Bleuacacia

Assuming the 90 days horizon WinVest Acquisition Corp is expected to under-perform the Bleuacacia. But the stock apears to be less risky and, when comparing its historical volatility, WinVest Acquisition Corp is 5.06 times less risky than Bleuacacia. The stock trades about -0.13 of its potential returns per unit of risk. The Bleuacacia Ltd Rights is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  2.00  in Bleuacacia Ltd Rights on October 9, 2024 and sell it today you would lose (1.15) from holding Bleuacacia Ltd Rights or give up 57.5% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	92.59%
Values	Daily Returns

WinVest Acquisition Corp  vs.  Bleuacacia Ltd Rights

WinVest Acquisition Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days WinVest Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with inconsistent performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in February 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Bleuacacia Rights

Risk-Adjusted Performance

0 of 100

OK

Over the last 90 days Bleuacacia Ltd Rights has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively weak basic indicators, Bleuacacia reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with WinVest Acquisition and Bleuacacia

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

The idea behind WinVest Acquisition Corp and Bleuacacia Ltd Rights 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.