Correlation Between Canoo Holdings and Orbit Garant
Can any of the company-specific risk be diversified away by investing in both Canoo Holdings and Orbit Garant 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 Canoo Holdings and Orbit Garant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Canoo Holdings and Orbit Garant Drilling, you can compare the effects of market volatilities on Canoo Holdings and Orbit Garant 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 Canoo Holdings with a short position of Orbit Garant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canoo Holdings and Orbit Garant.
Diversification Opportunities for Canoo Holdings and Orbit Garant
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Canoo and Orbit is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Canoo Holdings and Orbit Garant Drilling in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orbit Garant Drilling and Canoo 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 Canoo Holdings are associated (or correlated) with Orbit Garant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orbit Garant Drilling has no effect on the direction of Canoo Holdings i.e., Canoo Holdings and Orbit Garant go up and down completely randomly.
Pair Corralation between Canoo Holdings and Orbit Garant
Assuming the 90 days horizon Canoo Holdings is expected to generate 9.55 times more return on investment than Orbit Garant. However, Canoo Holdings is 9.55 times more volatile than Orbit Garant Drilling. It trades about 0.14 of its potential returns per unit of risk. Orbit Garant Drilling is currently generating about -0.21 per unit of risk. If you would invest 2.49 in Canoo Holdings on October 20, 2024 and sell it today you would earn a total of 0.58 from holding Canoo Holdings or generate 23.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Canoo Holdings vs. Orbit Garant Drilling
Performance |
| Timeline |
| Canoo Holdings |
| Orbit Garant Drilling |
Canoo Holdings and Orbit Garant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canoo Holdings and Orbit Garant
The main advantage of trading using opposite Canoo Holdings and Orbit Garant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canoo Holdings position performs unexpectedly, Orbit Garant 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 Orbit Garant will offset losses from the drop in Orbit Garant's long position.| Canoo Holdings vs. EVgo Equity Warrants | Canoo Holdings vs. Canoo Inc | Canoo Holdings vs. Paysafe Ltd Wt |
| Orbit Garant vs. Geodrill Limited | Orbit Garant vs. Prime Meridian Resources | Orbit Garant vs. Macmahon Holdings Limited | Orbit Garant vs. Hudson Resources |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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