Correlation Between Hyliion Holdings and Quantumscape Corp
Can any of the company-specific risk be diversified away by investing in both Hyliion Holdings and Quantumscape Corp 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 Quantumscape Corp 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 Quantumscape Corp, you can compare the effects of market volatilities on Hyliion Holdings and Quantumscape Corp 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 Quantumscape Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyliion Holdings and Quantumscape Corp.
Diversification Opportunities for Hyliion Holdings and Quantumscape Corp
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hyliion and Quantumscape is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Hyliion Holdings Corp and Quantumscape Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quantumscape Corp 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 Quantumscape Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quantumscape Corp has no effect on the direction of Hyliion Holdings i.e., Hyliion Holdings and Quantumscape Corp go up and down completely randomly.
Pair Corralation between Hyliion Holdings and Quantumscape Corp
Given the investment horizon of 90 days Hyliion Holdings Corp is expected to under-perform the Quantumscape Corp. But the stock apears to be less risky and, when comparing its historical volatility, Hyliion Holdings Corp is 1.09 times less risky than Quantumscape Corp. The stock trades about -0.07 of its potential returns per unit of risk. The Quantumscape Corp is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 519.00 in Quantumscape Corp on November 1, 2024 and sell it today you would earn a total of 3.00 from holding Quantumscape Corp or generate 0.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyliion Holdings Corp vs. Quantumscape Corp
Performance |
| Timeline |
| Hyliion Holdings Corp |
| Quantumscape Corp |
Hyliion Holdings and Quantumscape Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyliion Holdings and Quantumscape Corp
The main advantage of trading using opposite Hyliion Holdings and Quantumscape Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyliion Holdings position performs unexpectedly, Quantumscape Corp 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 Quantumscape Corp will offset losses from the drop in Quantumscape Corp's long position.| Hyliion Holdings vs. Quantumscape Corp | Hyliion Holdings vs. Mobileye Global Class | Hyliion Holdings vs. Innoviz Technologies | Hyliion Holdings vs. Aeva Technologies |
| Quantumscape Corp vs. Mobileye Global Class | Quantumscape Corp vs. Innoviz Technologies | Quantumscape Corp vs. Aeva Technologies | Quantumscape Corp vs. Hyliion Holdings Corp |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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