Correlation Between Aeva Technologies, and BFLY WT
Can any of the company-specific risk be diversified away by investing in both Aeva Technologies, and BFLY WT 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 Aeva Technologies, and BFLY WT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aeva Technologies, WT and BFLY WT, you can compare the effects of market volatilities on Aeva Technologies, and BFLY WT 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 Aeva Technologies, with a short position of BFLY WT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aeva Technologies, and BFLY WT.
Diversification Opportunities for Aeva Technologies, and BFLY WT
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Aeva and BFLY is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Aeva Technologies, WT and BFLY WT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BFLY WT and Aeva 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 Aeva Technologies, WT are associated (or correlated) with BFLY WT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BFLY WT has no effect on the direction of Aeva Technologies, i.e., Aeva Technologies, and BFLY WT go up and down completely randomly.
Pair Corralation between Aeva Technologies, and BFLY WT
Assuming the 90 days trading horizon Aeva Technologies, is expected to generate 3.52 times less return on investment than BFLY WT. But when comparing it to its historical volatility, Aeva Technologies, WT is 1.08 times less risky than BFLY WT. It trades about 0.16 of its potential returns per unit of risk. BFLY WT is currently generating about 0.53 of returns per unit of risk over similar time horizon. If you would invest 14.00 in BFLY WT on November 3, 2024 and sell it today you would earn a total of 27.00 from holding BFLY WT or generate 192.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 90.0% |
| Values | Daily Returns |
Aeva Technologies, WT vs. BFLY WT
Performance |
| Timeline |
| Aeva Technologies, |
| BFLY WT |
Aeva Technologies, and BFLY WT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aeva Technologies, and BFLY WT
The main advantage of trading using opposite Aeva Technologies, and BFLY WT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aeva Technologies, position performs unexpectedly, BFLY WT 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 BFLY WT will offset losses from the drop in BFLY WT's long position.| Aeva Technologies, vs. Innoviz Technologies | Aeva Technologies, vs. Paysafe Ltd Wt | Aeva Technologies, vs. Canoo Holdings | Aeva Technologies, vs. Nuvve Holding Corp |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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