Correlation Between Polestar Automotive and Bayerische Motoren
Can any of the company-specific risk be diversified away by investing in both Polestar Automotive and Bayerische Motoren 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 Polestar Automotive and Bayerische Motoren into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Polestar Automotive Holding and Bayerische Motoren Werke, you can compare the effects of market volatilities on Polestar Automotive and Bayerische Motoren 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 Polestar Automotive with a short position of Bayerische Motoren. Check out your portfolio center. Please also check ongoing floating volatility patterns of Polestar Automotive and Bayerische Motoren.
Diversification Opportunities for Polestar Automotive and Bayerische Motoren
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Polestar and Bayerische is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Polestar Automotive Holding and Bayerische Motoren Werke in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bayerische Motoren Werke and Polestar 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 Polestar Automotive Holding are associated (or correlated) with Bayerische Motoren. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bayerische Motoren Werke has no effect on the direction of Polestar Automotive i.e., Polestar Automotive and Bayerische Motoren go up and down completely randomly.
Pair Corralation between Polestar Automotive and Bayerische Motoren
If you would invest 91.00 in Polestar Automotive Holding on November 30, 2024 and sell it today you would lose (72.00) from holding Polestar Automotive Holding or give up 79.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Polestar Automotive Holding vs. Bayerische Motoren Werke
Performance |
| Timeline |
| Polestar Automotive |
| Bayerische Motoren Werke |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Polestar Automotive and Bayerische Motoren Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Polestar Automotive and Bayerische Motoren
The main advantage of trading using opposite Polestar Automotive and Bayerische Motoren positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Polestar Automotive position performs unexpectedly, Bayerische Motoren 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 Bayerische Motoren will offset losses from the drop in Bayerische Motoren's long position.| Polestar Automotive vs. Lucid Group | Polestar Automotive vs. Rivian Automotive | Polestar Automotive vs. Aston Martin Lagonda | Polestar Automotive vs. Geely Automobile Holdings |
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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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