Correlation Between Mullen Automotive and Cenntro Electric
Can any of the company-specific risk be diversified away by investing in both Mullen Automotive and Cenntro Electric 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 Mullen Automotive and Cenntro Electric into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mullen Automotive and Cenntro Electric Group, you can compare the effects of market volatilities on Mullen Automotive and Cenntro Electric 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 Mullen Automotive with a short position of Cenntro Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mullen Automotive and Cenntro Electric.
Diversification Opportunities for Mullen Automotive and Cenntro Electric
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Mullen and Cenntro is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Mullen Automotive and Cenntro Electric Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cenntro Electric and Mullen Automotive 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 Mullen Automotive are associated (or correlated) with Cenntro Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cenntro Electric has no effect on the direction of Mullen Automotive i.e., Mullen Automotive and Cenntro Electric go up and down completely randomly.
Pair Corralation between Mullen Automotive and Cenntro Electric
Given the investment horizon of 90 days Mullen Automotive is expected to generate 5.98 times more return on investment than Cenntro Electric. However, Mullen Automotive is 5.98 times more volatile than Cenntro Electric Group. It trades about 0.1 of its potential returns per unit of risk. Cenntro Electric Group is currently generating about -0.11 per unit of risk. If you would invest 253.00 in Mullen Automotive on August 28, 2024 and sell it today you would earn a total of 34.00 from holding Mullen Automotive or generate 13.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mullen Automotive vs. Cenntro Electric Group
Performance |
| Timeline |
| Mullen Automotive |
| Cenntro Electric |
Mullen Automotive and Cenntro Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mullen Automotive and Cenntro Electric
The main advantage of trading using opposite Mullen Automotive and Cenntro Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mullen Automotive position performs unexpectedly, Cenntro Electric 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 Cenntro Electric will offset losses from the drop in Cenntro Electric's long position.| Mullen Automotive vs. Hycroft Mining Holding | Mullen Automotive vs. Imperial Petroleum | Mullen Automotive vs. Camber Energy |
| Cenntro Electric vs. Mullen Automotive | Cenntro Electric vs. Canoo Inc | Cenntro Electric vs. Hyzon Motors | Cenntro Electric vs. AYRO 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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