Correlation Between Hyliion Holdings and Lordstown Motors
Can any of the company-specific risk be diversified away by investing in both Hyliion Holdings and Lordstown Motors 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 Lordstown Motors 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 Lordstown Motors Corp, you can compare the effects of market volatilities on Hyliion Holdings and Lordstown Motors 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 Lordstown Motors. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyliion Holdings and Lordstown Motors.
Diversification Opportunities for Hyliion Holdings and Lordstown Motors
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Hyliion and Lordstown is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Hyliion Holdings Corp and Lordstown Motors Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lordstown Motors 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 Lordstown Motors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lordstown Motors Corp has no effect on the direction of Hyliion Holdings i.e., Hyliion Holdings and Lordstown Motors go up and down completely randomly.
Pair Corralation between Hyliion Holdings and Lordstown Motors
If you would invest 241.00 in Hyliion Holdings Corp on August 24, 2024 and sell it today you would earn a total of 130.00 from holding Hyliion Holdings Corp or generate 53.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
Hyliion Holdings Corp vs. Lordstown Motors Corp
Performance |
| Timeline |
| Hyliion Holdings Corp |
| Lordstown Motors Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Hyliion Holdings and Lordstown Motors Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyliion Holdings and Lordstown Motors
The main advantage of trading using opposite Hyliion Holdings and Lordstown Motors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyliion Holdings position performs unexpectedly, Lordstown Motors 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 Lordstown Motors will offset losses from the drop in Lordstown Motors' long position.| Hyliion Holdings vs. Quantumscape Corp | Hyliion Holdings vs. Mobileye Global Class | Hyliion Holdings vs. Innoviz Technologies | Hyliion Holdings vs. Aeva Technologies |
| Lordstown Motors vs. Workhorse Group | Lordstown Motors vs. Canoo Inc | Lordstown Motors vs. Hyliion Holdings Corp | Lordstown Motors vs. Blink Charging Co |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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