Correlation Between Innoviz Technologies and Lilium Equity
Can any of the company-specific risk be diversified away by investing in both Innoviz Technologies and Lilium Equity 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 Lilium Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innoviz Technologies and Lilium Equity Warrants, you can compare the effects of market volatilities on Innoviz Technologies and Lilium Equity 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 Lilium Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innoviz Technologies and Lilium Equity.
Diversification Opportunities for Innoviz Technologies and Lilium Equity
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Innoviz and Lilium is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Innoviz Technologies and Lilium Equity Warrants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lilium Equity Warrants 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 Lilium Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lilium Equity Warrants has no effect on the direction of Innoviz Technologies i.e., Innoviz Technologies and Lilium Equity go up and down completely randomly.
Pair Corralation between Innoviz Technologies and Lilium Equity
Assuming the 90 days horizon Innoviz Technologies is expected to generate 6.74 times more return on investment than Lilium Equity. However, Innoviz Technologies is 6.74 times more volatile than Lilium Equity Warrants. It trades about 0.09 of its potential returns per unit of risk. Lilium Equity Warrants is currently generating about 0.0 per unit of risk. If you would invest 52.00 in Innoviz Technologies on September 1, 2024 and sell it today you would lose (42.45) from holding Innoviz Technologies or give up 81.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 96.06% |
| Values | Daily Returns |
Innoviz Technologies vs. Lilium Equity Warrants
Performance |
| Timeline |
| Innoviz Technologies |
| Lilium Equity Warrants |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Innoviz Technologies and Lilium Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innoviz Technologies and Lilium Equity
The main advantage of trading using opposite Innoviz Technologies and Lilium Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innoviz Technologies position performs unexpectedly, Lilium Equity 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 Lilium Equity will offset losses from the drop in Lilium Equity's long position.| Innoviz Technologies vs. Ouster Inc | Innoviz Technologies vs. Aeva Technologies, WT | Innoviz Technologies vs. Innoviz Technologies | Innoviz Technologies vs. EVgo Equity Warrants |
| Lilium Equity vs. Joby Aviation | Lilium Equity vs. Lilium NV | Lilium Equity vs. AEye Inc | Lilium Equity vs. Microvast Holdings |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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