Correlation Between Hyliion Holdings and Holley
Can any of the company-specific risk be diversified away by investing in both Hyliion Holdings and Holley 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 Hyliion Holdings and Holley into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyliion Holdings Corp and Holley Inc, you can compare the effects of market volatilities on Hyliion Holdings and Holley 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 Hyliion Holdings with a short position of Holley. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyliion Holdings and Holley.
Diversification Opportunities for Hyliion Holdings and Holley
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hyliion and Holley is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Hyliion Holdings Corp and Holley Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Holley Inc and Hyliion 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 Hyliion Holdings Corp are associated (or correlated) with Holley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Holley Inc has no effect on the direction of Hyliion Holdings i.e., Hyliion Holdings and Holley go up and down completely randomly.
Pair Corralation between Hyliion Holdings and Holley
Given the investment horizon of 90 days Hyliion Holdings Corp is expected to generate 2.83 times more return on investment than Holley. However, Hyliion Holdings is 2.83 times more volatile than Holley Inc. It trades about 0.32 of its potential returns per unit of risk. Holley Inc is currently generating about 0.1 per unit of risk. If you would invest 240.00 in Hyliion Holdings Corp on August 26, 2024 and sell it today you would earn a total of 144.00 from holding Hyliion Holdings Corp or generate 60.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyliion Holdings Corp vs. Holley Inc
Performance |
| Timeline |
| Hyliion Holdings Corp |
| Holley Inc |
Hyliion Holdings and Holley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyliion Holdings and Holley
The main advantage of trading using opposite Hyliion Holdings and Holley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyliion Holdings position performs unexpectedly, Holley 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 Holley will offset losses from the drop in Holley's long position.| Hyliion Holdings vs. Quantumscape Corp | Hyliion Holdings vs. Mobileye Global Class | Hyliion Holdings vs. Innoviz Technologies | Hyliion Holdings vs. Aeva Technologies |
| Holley vs. Dorman Products | Holley vs. Monro Muffler Brake | Holley vs. Standard Motor Products | Holley vs. Stoneridge |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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