Correlation Between Advent Technologies and Xos Equity
Can any of the company-specific risk be diversified away by investing in both Advent Technologies and Xos Equity 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 Advent Technologies and Xos Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advent Technologies Holdings and Xos Equity Warrants, you can compare the effects of market volatilities on Advent Technologies and Xos Equity 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 Advent Technologies with a short position of Xos Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advent Technologies and Xos Equity.
Diversification Opportunities for Advent Technologies and Xos Equity
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Advent and Xos is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Advent Technologies Holdings and Xos Equity Warrants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xos Equity Warrants and Advent Technologies 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 Advent Technologies Holdings are associated (or correlated) with Xos Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xos Equity Warrants has no effect on the direction of Advent Technologies i.e., Advent Technologies and Xos Equity go up and down completely randomly.
Pair Corralation between Advent Technologies and Xos Equity
Assuming the 90 days horizon Advent Technologies is expected to generate 63.04 times less return on investment than Xos Equity. But when comparing it to its historical volatility, Advent Technologies Holdings is 14.33 times less risky than Xos Equity. It trades about 0.03 of its potential returns per unit of risk. Xos Equity Warrants is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 0.00 in Xos Equity Warrants on August 28, 2024 and sell it today you would earn a total of 0.61 from holding Xos Equity Warrants or generate 9.223372036854776E16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 84.38% |
| Values | Daily Returns |
Advent Technologies Holdings vs. Xos Equity Warrants
Performance |
| Timeline |
| Advent Technologies |
| Xos Equity Warrants |
Advent Technologies and Xos Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advent Technologies and Xos Equity
The main advantage of trading using opposite Advent Technologies and Xos Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advent Technologies position performs unexpectedly, Xos Equity 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 Xos Equity will offset losses from the drop in Xos Equity's long position.The idea behind Advent Technologies Holdings and Xos Equity Warrants 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.| Xos Equity vs. Microvast Holdings | Xos Equity vs. EVgo Equity Warrants | Xos Equity vs. Faraday Future Intelligent | Xos Equity vs. Xos Inc |
Check out your portfolio center.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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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