Correlation Between Lion Electric and Greengro Tech
Can any of the company-specific risk be diversified away by investing in both Lion Electric and Greengro Tech 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 Lion Electric and Greengro Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lion Electric Corp and Greengro Tech, you can compare the effects of market volatilities on Lion Electric and Greengro Tech 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 Lion Electric with a short position of Greengro Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lion Electric and Greengro Tech.
Diversification Opportunities for Lion Electric and Greengro Tech
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lion and Greengro is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Lion Electric Corp and Greengro Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greengro Tech and Lion Electric 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 Lion Electric Corp are associated (or correlated) with Greengro Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greengro Tech has no effect on the direction of Lion Electric i.e., Lion Electric and Greengro Tech go up and down completely randomly.
Pair Corralation between Lion Electric and Greengro Tech
Considering the 90-day investment horizon Lion Electric Corp is expected to under-perform the Greengro Tech. But the stock apears to be less risky and, when comparing its historical volatility, Lion Electric Corp is 20.56 times less risky than Greengro Tech. The stock trades about -0.07 of its potential returns per unit of risk. The Greengro Tech is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 0.01 in Greengro Tech on September 14, 2024 and sell it today you would lose (0.01) from holding Greengro Tech or give up 100.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Lion Electric Corp vs. Greengro Tech
Performance |
| Timeline |
| Lion Electric Corp |
| Greengro Tech |
Lion Electric and Greengro Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lion Electric and Greengro Tech
The main advantage of trading using opposite Lion Electric and Greengro Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lion Electric position performs unexpectedly, Greengro Tech 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 Greengro Tech will offset losses from the drop in Greengro Tech's long position.| Lion Electric vs. Xos Inc | Lion Electric vs. Ideanomics | Lion Electric vs. Nikola Corp | Lion Electric vs. Wabash National |
| Greengro Tech vs. Austin Engineering Limited | Greengro Tech vs. Grow Solutions Holdings | Greengro Tech vs. Buhler Industries | Greengro Tech vs. First Tractor |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |