Correlation Between Ideanomics and Lightning EMotors
Can any of the company-specific risk be diversified away by investing in both Ideanomics and Lightning EMotors 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 Ideanomics and Lightning EMotors into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ideanomics and Lightning EMotors, you can compare the effects of market volatilities on Ideanomics and Lightning EMotors 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 Ideanomics with a short position of Lightning EMotors. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ideanomics and Lightning EMotors.
Diversification Opportunities for Ideanomics and Lightning EMotors
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ideanomics and Lightning is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Ideanomics and Lightning EMotors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lightning EMotors and Ideanomics 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 Ideanomics are associated (or correlated) with Lightning EMotors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lightning EMotors has no effect on the direction of Ideanomics i.e., Ideanomics and Lightning EMotors go up and down completely randomly.
Pair Corralation between Ideanomics and Lightning EMotors
If you would invest 5.00 in Ideanomics on November 2, 2024 and sell it today you would lose (4.89) from holding Ideanomics or give up 97.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 5.26% |
| Values | Daily Returns |
Ideanomics vs. Lightning EMotors
Performance |
| Timeline |
| Ideanomics |
| Lightning EMotors |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ideanomics and Lightning EMotors Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ideanomics and Lightning EMotors
The main advantage of trading using opposite Ideanomics and Lightning EMotors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ideanomics position performs unexpectedly, Lightning EMotors 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 Lightning EMotors will offset losses from the drop in Lightning EMotors' long position.| Ideanomics vs. Deere Company | Ideanomics vs. Caterpillar | Ideanomics vs. Xos Inc | Ideanomics vs. Nikola Corp |
| Lightning EMotors vs. American Premium Water | Lightning EMotors vs. Wabash National | Lightning EMotors vs. Titan International | Lightning EMotors vs. Xos Inc |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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