Correlation Between Innoviz Technologies and Westport Fuel
Can any of the company-specific risk be diversified away by investing in both Innoviz Technologies and Westport Fuel 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 Innoviz Technologies and Westport Fuel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innoviz Technologies and Westport Fuel Systems, you can compare the effects of market volatilities on Innoviz Technologies and Westport Fuel 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 Innoviz Technologies with a short position of Westport Fuel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innoviz Technologies and Westport Fuel.
Diversification Opportunities for Innoviz Technologies and Westport Fuel
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Innoviz and Westport is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Innoviz Technologies and Westport Fuel Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westport Fuel Systems and Innoviz Technologies 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 Innoviz Technologies are associated (or correlated) with Westport Fuel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westport Fuel Systems has no effect on the direction of Innoviz Technologies i.e., Innoviz Technologies and Westport Fuel go up and down completely randomly.
Pair Corralation between Innoviz Technologies and Westport Fuel
Given the investment horizon of 90 days Innoviz Technologies is expected to generate 2.86 times more return on investment than Westport Fuel. However, Innoviz Technologies is 2.86 times more volatile than Westport Fuel Systems. It trades about 0.14 of its potential returns per unit of risk. Westport Fuel Systems is currently generating about 0.01 per unit of risk. If you would invest 82.00 in Innoviz Technologies on October 31, 2024 and sell it today you would earn a total of 83.00 from holding Innoviz Technologies or generate 101.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Innoviz Technologies vs. Westport Fuel Systems
Performance |
| Timeline |
| Innoviz Technologies |
| Westport Fuel Systems |
Innoviz Technologies and Westport Fuel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innoviz Technologies and Westport Fuel
The main advantage of trading using opposite Innoviz Technologies and Westport Fuel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innoviz Technologies position performs unexpectedly, Westport Fuel 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 Westport Fuel will offset losses from the drop in Westport Fuel's long position.| Innoviz Technologies vs. Aeye Inc | Innoviz Technologies vs. Luminar Technologies | Innoviz Technologies vs. Hesai Group American | Innoviz Technologies vs. Mobileye Global Class |
| Westport Fuel vs. Foresight Autonomous Holdings | Westport Fuel vs. Hyliion Holdings Corp | Westport Fuel vs. American Axle Manufacturing | Westport Fuel vs. Gentex |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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