Correlation Between Evolv Technologies and ADTRAN
Can any of the company-specific risk be diversified away by investing in both Evolv Technologies and ADTRAN 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 Evolv Technologies and ADTRAN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evolv Technologies Holdings and ADTRAN Inc, you can compare the effects of market volatilities on Evolv Technologies and ADTRAN 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 Evolv Technologies with a short position of ADTRAN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evolv Technologies and ADTRAN.
Diversification Opportunities for Evolv Technologies and ADTRAN
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Evolv and ADTRAN is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Evolv Technologies Holdings and ADTRAN Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADTRAN Inc and Evolv 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 Evolv Technologies Holdings are associated (or correlated) with ADTRAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADTRAN Inc has no effect on the direction of Evolv Technologies i.e., Evolv Technologies and ADTRAN go up and down completely randomly.
Pair Corralation between Evolv Technologies and ADTRAN
Given the investment horizon of 90 days Evolv Technologies Holdings is expected to generate 1.58 times more return on investment than ADTRAN. However, Evolv Technologies is 1.58 times more volatile than ADTRAN Inc. It trades about 0.03 of its potential returns per unit of risk. ADTRAN Inc is currently generating about -0.03 per unit of risk. If you would invest 370.00 in Evolv Technologies Holdings on September 2, 2024 and sell it today you would earn a total of 35.00 from holding Evolv Technologies Holdings or generate 9.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Evolv Technologies Holdings vs. ADTRAN Inc
Performance |
| Timeline |
| Evolv Technologies |
| ADTRAN Inc |
Evolv Technologies and ADTRAN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evolv Technologies and ADTRAN
The main advantage of trading using opposite Evolv Technologies and ADTRAN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evolv Technologies position performs unexpectedly, ADTRAN 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 ADTRAN will offset losses from the drop in ADTRAN's long position.| Evolv Technologies vs. First Responder Technologies | Evolv Technologies vs. Knightscope | Evolv Technologies vs. LogicMark | Evolv Technologies vs. Guardforce AI Co |
| ADTRAN vs. Mynaric AG ADR | ADTRAN vs. KVH Industries | ADTRAN vs. Telesat Corp | ADTRAN vs. Digi International |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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