Correlation Between EVgo Equity and Canoo Holdings
Can any of the company-specific risk be diversified away by investing in both EVgo Equity and Canoo Holdings 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 EVgo Equity and Canoo Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EVgo Equity Warrants and Canoo Holdings, you can compare the effects of market volatilities on EVgo Equity and Canoo Holdings 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 EVgo Equity with a short position of Canoo Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of EVgo Equity and Canoo Holdings.
Diversification Opportunities for EVgo Equity and Canoo Holdings
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between EVgo and Canoo is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding EVgo Equity Warrants and Canoo Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canoo Holdings and EVgo Equity 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 EVgo Equity Warrants are associated (or correlated) with Canoo Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canoo Holdings has no effect on the direction of EVgo Equity i.e., EVgo Equity and Canoo Holdings go up and down completely randomly.
Pair Corralation between EVgo Equity and Canoo Holdings
Assuming the 90 days horizon EVgo Equity Warrants is expected to generate 1.26 times more return on investment than Canoo Holdings. However, EVgo Equity is 1.26 times more volatile than Canoo Holdings. It trades about 0.05 of its potential returns per unit of risk. Canoo Holdings is currently generating about -0.01 per unit of risk. If you would invest 85.00 in EVgo Equity Warrants on August 27, 2024 and sell it today you would earn a total of 26.00 from holding EVgo Equity Warrants or generate 30.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EVgo Equity Warrants vs. Canoo Holdings
Performance |
| Timeline |
| EVgo Equity Warrants |
| Canoo Holdings |
EVgo Equity and Canoo Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EVgo Equity and Canoo Holdings
The main advantage of trading using opposite EVgo Equity and Canoo Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EVgo Equity position performs unexpectedly, Canoo Holdings 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 Canoo Holdings will offset losses from the drop in Canoo Holdings' long position.| EVgo Equity vs. Nuvve Holding Corp | EVgo Equity vs. Paysafe Ltd Wt | EVgo Equity vs. Canoo Holdings | EVgo Equity vs. Microvast Holdings |
| Canoo Holdings vs. EVgo Equity Warrants | Canoo Holdings vs. Canoo Inc | Canoo Holdings vs. Paysafe Ltd Wt |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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