Correlation Between GreenPower and NWTN
Can any of the company-specific risk be diversified away by investing in both GreenPower and NWTN 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 GreenPower and NWTN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GreenPower Motor and NWTN Class B, you can compare the effects of market volatilities on GreenPower and NWTN 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 GreenPower with a short position of NWTN. Check out your portfolio center. Please also check ongoing floating volatility patterns of GreenPower and NWTN.
Diversification Opportunities for GreenPower and NWTN
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GreenPower and NWTN is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding GreenPower Motor and NWTN Class B in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NWTN Class B and GreenPower 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 GreenPower Motor are associated (or correlated) with NWTN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NWTN Class B has no effect on the direction of GreenPower i.e., GreenPower and NWTN go up and down completely randomly.
Pair Corralation between GreenPower and NWTN
Allowing for the 90-day total investment horizon GreenPower Motor is expected to generate 0.75 times more return on investment than NWTN. However, GreenPower Motor is 1.33 times less risky than NWTN. It trades about 0.0 of its potential returns per unit of risk. NWTN Class B is currently generating about -0.03 per unit of risk. If you would invest 222.00 in GreenPower Motor on September 3, 2024 and sell it today you would lose (123.00) from holding GreenPower Motor or give up 55.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GreenPower Motor vs. NWTN Class B
Performance |
| Timeline |
| GreenPower Motor |
| NWTN Class B |
GreenPower and NWTN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GreenPower and NWTN
The main advantage of trading using opposite GreenPower and NWTN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GreenPower position performs unexpectedly, NWTN 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 NWTN will offset losses from the drop in NWTN's long position.| GreenPower vs. Phoenix Motor Common | GreenPower vs. Envirotech Vehicles | GreenPower vs. Volcon Inc | GreenPower vs. Zapp Electric Vehicles |
| NWTN vs. GreenPower Motor | NWTN vs. ZEEKR Intelligent Technology | NWTN vs. Volcon Inc | NWTN vs. Ford Motor |
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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