Correlation Between Lilium Equity and Archer Aviation
Can any of the company-specific risk be diversified away by investing in both Lilium Equity and Archer Aviation 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 Lilium Equity and Archer Aviation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lilium Equity Warrants and Archer Aviation, you can compare the effects of market volatilities on Lilium Equity and Archer Aviation 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 Lilium Equity with a short position of Archer Aviation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lilium Equity and Archer Aviation.
Diversification Opportunities for Lilium Equity and Archer Aviation
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lilium and Archer is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Lilium Equity Warrants and Archer Aviation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Archer Aviation and Lilium Equity 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 Lilium Equity Warrants are associated (or correlated) with Archer Aviation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Archer Aviation has no effect on the direction of Lilium Equity i.e., Lilium Equity and Archer Aviation go up and down completely randomly.
Pair Corralation between Lilium Equity and Archer Aviation
Assuming the 90 days horizon Lilium Equity Warrants is expected to under-perform the Archer Aviation. In addition to that, Lilium Equity is 4.78 times more volatile than Archer Aviation. It trades about -0.32 of its total potential returns per unit of risk. Archer Aviation is currently generating about 0.43 per unit of volatility. If you would invest 312.00 in Archer Aviation on August 24, 2024 and sell it today you would earn a total of 266.00 from holding Archer Aviation or generate 85.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 52.17% |
| Values | Daily Returns |
Lilium Equity Warrants vs. Archer Aviation
Performance |
| Timeline |
| Lilium Equity Warrants |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Archer Aviation |
Lilium Equity and Archer Aviation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lilium Equity and Archer Aviation
The main advantage of trading using opposite Lilium Equity and Archer Aviation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lilium Equity position performs unexpectedly, Archer Aviation 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 Archer Aviation will offset losses from the drop in Archer Aviation's long position.| Lilium Equity vs. Joby Aviation | Lilium Equity vs. Lilium NV | Lilium Equity vs. AEye Inc | Lilium Equity vs. Microvast Holdings |
| Archer Aviation vs. Vertical Aerospace | Archer Aviation vs. Ehang Holdings | Archer Aviation vs. Rocket Lab USA | Archer Aviation vs. Lilium NV |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |