Correlation Between Evolv Technologies and AdTheorent Holding
Can any of the company-specific risk be diversified away by investing in both Evolv Technologies and AdTheorent Holding 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 AdTheorent Holding 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 AdTheorent Holding, you can compare the effects of market volatilities on Evolv Technologies and AdTheorent Holding 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 AdTheorent Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evolv Technologies and AdTheorent Holding.
Diversification Opportunities for Evolv Technologies and AdTheorent Holding
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Evolv and AdTheorent is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Evolv Technologies Holdings and AdTheorent Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AdTheorent Holding 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 AdTheorent Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AdTheorent Holding has no effect on the direction of Evolv Technologies i.e., Evolv Technologies and AdTheorent Holding go up and down completely randomly.
Pair Corralation between Evolv Technologies and AdTheorent Holding
Assuming the 90 days horizon Evolv Technologies is expected to generate 2.04 times less return on investment than AdTheorent Holding. In addition to that, Evolv Technologies is 4.41 times more volatile than AdTheorent Holding. It trades about 0.03 of its total potential returns per unit of risk. AdTheorent Holding is currently generating about 0.31 per unit of volatility. If you would invest 44.00 in AdTheorent Holding on August 28, 2024 and sell it today you would earn a total of 3.00 from holding AdTheorent Holding or generate 6.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 8.8% |
| Values | Daily Returns |
Evolv Technologies Holdings vs. AdTheorent Holding
Performance |
| Timeline |
| Evolv Technologies |
| AdTheorent Holding |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Evolv Technologies and AdTheorent Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evolv Technologies and AdTheorent Holding
The main advantage of trading using opposite Evolv Technologies and AdTheorent Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evolv Technologies position performs unexpectedly, AdTheorent Holding 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 AdTheorent Holding will offset losses from the drop in AdTheorent Holding's long position.| Evolv Technologies vs. EVgo Equity Warrants | Evolv Technologies vs. Algoma Steel Group | Evolv Technologies vs. Landsea Homes |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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