Correlation Between East Africa and XL Fleet
Can any of the company-specific risk be diversified away by investing in both East Africa and XL Fleet 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 East Africa and XL Fleet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between East Africa Metals and XL Fleet Corp, you can compare the effects of market volatilities on East Africa and XL Fleet 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 East Africa with a short position of XL Fleet. Check out your portfolio center. Please also check ongoing floating volatility patterns of East Africa and XL Fleet.
Diversification Opportunities for East Africa and XL Fleet
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between East and XL Fleet is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding East Africa Metals and XL Fleet Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XL Fleet Corp and East Africa 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 East Africa Metals are associated (or correlated) with XL Fleet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XL Fleet Corp has no effect on the direction of East Africa i.e., East Africa and XL Fleet go up and down completely randomly.
Pair Corralation between East Africa and XL Fleet
If you would invest 101.00 in XL Fleet Corp on September 23, 2024 and sell it today you would earn a total of 0.00 from holding XL Fleet Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 0.78% |
| Values | Daily Returns |
East Africa Metals vs. XL Fleet Corp
Performance |
| Timeline |
| East Africa Metals |
| XL Fleet Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
East Africa and XL Fleet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with East Africa and XL Fleet
The main advantage of trading using opposite East Africa and XL Fleet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if East Africa position performs unexpectedly, XL Fleet 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 XL Fleet will offset losses from the drop in XL Fleet's long position.| East Africa vs. Puma Exploration | East Africa vs. Sixty North Gold | East Africa vs. Red Pine Exploration | East Africa vs. Grande Portage Resources |
| XL Fleet vs. Blue Moon Metals | XL Fleet vs. Forsys Metals Corp | XL Fleet vs. Lifevantage | XL Fleet vs. East Africa Metals |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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