Correlation Between EV Technology and Volkswagen
Can any of the company-specific risk be diversified away by investing in both EV Technology and Volkswagen 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 EV Technology and Volkswagen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EV Technology Group and Volkswagen AG Pref, you can compare the effects of market volatilities on EV Technology and Volkswagen 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 EV Technology with a short position of Volkswagen. Check out your portfolio center. Please also check ongoing floating volatility patterns of EV Technology and Volkswagen.
Diversification Opportunities for EV Technology and Volkswagen
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between EVTGF and Volkswagen is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding EV Technology Group and Volkswagen AG Pref in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Volkswagen AG Pref and EV Technology 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 EV Technology Group are associated (or correlated) with Volkswagen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Volkswagen AG Pref has no effect on the direction of EV Technology i.e., EV Technology and Volkswagen go up and down completely randomly.
Pair Corralation between EV Technology and Volkswagen
If you would invest 1,014 in Volkswagen AG Pref on December 5, 2024 and sell it today you would earn a total of 124.00 from holding Volkswagen AG Pref or generate 12.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.19% |
| Values | Daily Returns |
EV Technology Group vs. Volkswagen AG Pref
Performance |
| Timeline |
| EV Technology Group |
| Volkswagen AG Pref |
EV Technology and Volkswagen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EV Technology and Volkswagen
The main advantage of trading using opposite EV Technology and Volkswagen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EV Technology position performs unexpectedly, Volkswagen 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 Volkswagen will offset losses from the drop in Volkswagen's long position.| EV Technology vs. Genesis Electronics Group | ||
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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