Correlation Between Ehang Holdings and Virgin Galactic
Can any of the company-specific risk be diversified away by investing in both Ehang Holdings and Virgin Galactic 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 Ehang Holdings and Virgin Galactic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ehang Holdings and Virgin Galactic Holdings, you can compare the effects of market volatilities on Ehang Holdings and Virgin Galactic 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 Ehang Holdings with a short position of Virgin Galactic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ehang Holdings and Virgin Galactic.
Diversification Opportunities for Ehang Holdings and Virgin Galactic
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ehang and Virgin is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Ehang Holdings and Virgin Galactic Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virgin Galactic Holdings and Ehang Holdings 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 Ehang Holdings are associated (or correlated) with Virgin Galactic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virgin Galactic Holdings has no effect on the direction of Ehang Holdings i.e., Ehang Holdings and Virgin Galactic go up and down completely randomly.
Pair Corralation between Ehang Holdings and Virgin Galactic
Allowing for the 90-day total investment horizon Ehang Holdings is expected to generate 0.65 times more return on investment than Virgin Galactic. However, Ehang Holdings is 1.54 times less risky than Virgin Galactic. It trades about 0.14 of its potential returns per unit of risk. Virgin Galactic Holdings is currently generating about -0.29 per unit of risk. If you would invest 1,567 in Ehang Holdings on November 2, 2024 and sell it today you would earn a total of 106.00 from holding Ehang Holdings or generate 6.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ehang Holdings vs. Virgin Galactic Holdings
Performance |
| Timeline |
| Ehang Holdings |
| Virgin Galactic Holdings |
Ehang Holdings and Virgin Galactic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ehang Holdings and Virgin Galactic
The main advantage of trading using opposite Ehang Holdings and Virgin Galactic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ehang Holdings position performs unexpectedly, Virgin Galactic 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 Virgin Galactic will offset losses from the drop in Virgin Galactic's long position.| Ehang Holdings vs. Archer Aviation | Ehang Holdings vs. Vertical Aerospace | Ehang Holdings vs. Rocket Lab USA | Ehang Holdings vs. Lilium NV |
| Virgin Galactic vs. Planet Labs PBC | Virgin Galactic vs. Eve Holding | Virgin Galactic vs. Redwire Corp | Virgin Galactic vs. Lockheed Martin |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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