Correlation Between Holley and Aeva Technologies
Can any of the company-specific risk be diversified away by investing in both Holley and Aeva Technologies 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 Holley and Aeva Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Holley Inc and Aeva Technologies, you can compare the effects of market volatilities on Holley and Aeva Technologies 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 Holley with a short position of Aeva Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Holley and Aeva Technologies.
Diversification Opportunities for Holley and Aeva Technologies
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Holley and Aeva is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Holley Inc and Aeva Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aeva Technologies and Holley 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 Holley Inc are associated (or correlated) with Aeva Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aeva Technologies has no effect on the direction of Holley i.e., Holley and Aeva Technologies go up and down completely randomly.
Pair Corralation between Holley and Aeva Technologies
Given the investment horizon of 90 days Holley Inc is expected to generate 0.52 times more return on investment than Aeva Technologies. However, Holley Inc is 1.92 times less risky than Aeva Technologies. It trades about -0.09 of its potential returns per unit of risk. Aeva Technologies is currently generating about -0.15 per unit of risk. If you would invest 280.00 in Holley Inc on August 23, 2024 and sell it today you would lose (15.00) from holding Holley Inc or give up 5.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Holley Inc vs. Aeva Technologies
Performance |
| Timeline |
| Holley Inc |
| Aeva Technologies |
Holley and Aeva Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Holley and Aeva Technologies
The main advantage of trading using opposite Holley and Aeva Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Holley position performs unexpectedly, Aeva Technologies 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 Aeva Technologies will offset losses from the drop in Aeva Technologies' long position.| Holley vs. Dorman Products | Holley vs. Monro Muffler Brake | Holley vs. Standard Motor Products | Holley vs. Stoneridge |
| Aeva Technologies vs. Gentex | Aeva Technologies vs. Adient PLC | Aeva Technologies vs. Autoliv | Aeva Technologies vs. Fox Factory Holding |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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