Correlation Between Microvast Holdings and Otonomo Technologies
Can any of the company-specific risk be diversified away by investing in both Microvast Holdings and Otonomo Technologies 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 Microvast Holdings and Otonomo Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microvast Holdings and Otonomo Technologies, you can compare the effects of market volatilities on Microvast Holdings and Otonomo Technologies 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 Microvast Holdings with a short position of Otonomo Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microvast Holdings and Otonomo Technologies.
Diversification Opportunities for Microvast Holdings and Otonomo Technologies
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Microvast and Otonomo is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Microvast Holdings and Otonomo Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Otonomo Technologies and Microvast Holdings 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 Microvast Holdings are associated (or correlated) with Otonomo Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Otonomo Technologies has no effect on the direction of Microvast Holdings i.e., Microvast Holdings and Otonomo Technologies go up and down completely randomly.
Pair Corralation between Microvast Holdings and Otonomo Technologies
If you would invest 2.00 in Otonomo Technologies on November 3, 2024 and sell it today you would earn a total of 0.00 from holding Otonomo Technologies or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Microvast Holdings vs. Otonomo Technologies
Performance |
| Timeline |
| Microvast Holdings |
| Otonomo Technologies |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Microvast Holdings and Otonomo Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microvast Holdings and Otonomo Technologies
The main advantage of trading using opposite Microvast Holdings and Otonomo Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microvast Holdings position performs unexpectedly, Otonomo Technologies 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 Otonomo Technologies will offset losses from the drop in Otonomo Technologies' long position.| Microvast Holdings vs. Microvast Holdings | Microvast Holdings vs. EVgo Equity Warrants | Microvast Holdings vs. Paysafe Ltd Wt | Microvast Holdings vs. Faraday Future Intelligent |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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