Correlation Between NYSE Composite and Evolv Technologies
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Evolv 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 NYSE Composite and Evolv Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Evolv Technologies Holdings, you can compare the effects of market volatilities on NYSE Composite and Evolv 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 NYSE Composite with a short position of Evolv Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Evolv Technologies.
Diversification Opportunities for NYSE Composite and Evolv Technologies
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NYSE and Evolv is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Evolv Technologies Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evolv Technologies and NYSE Composite 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 NYSE Composite are associated (or correlated) with Evolv Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evolv Technologies has no effect on the direction of NYSE Composite i.e., NYSE Composite and Evolv Technologies go up and down completely randomly.
Pair Corralation between NYSE Composite and Evolv Technologies
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.05 times more return on investment than Evolv Technologies. However, NYSE Composite is 20.38 times less risky than Evolv Technologies. It trades about 0.18 of its potential returns per unit of risk. Evolv Technologies Holdings is currently generating about -0.16 per unit of risk. If you would invest 1,959,424 in NYSE Composite on August 24, 2024 and sell it today you would earn a total of 52,921 from holding NYSE Composite or generate 2.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Evolv Technologies Holdings
Performance |
| Timeline |
NYSE Composite and Evolv Technologies Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Evolv Technologies Holdings
Pair trading matchups for Evolv Technologies
Pair Trading with NYSE Composite and Evolv Technologies
The main advantage of trading using opposite NYSE Composite and Evolv Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Evolv 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 Evolv Technologies will offset losses from the drop in Evolv Technologies' long position.| NYSE Composite vs. Awilco Drilling PLC | NYSE Composite vs. AKITA Drilling | NYSE Composite vs. SunOpta | NYSE Composite vs. Delek Drilling |
| Evolv Technologies vs. EVgo Equity Warrants | Evolv Technologies vs. Algoma Steel Group | Evolv Technologies vs. Landsea Homes |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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