Correlation Between Polestar Automotive and First Hydrogen
Can any of the company-specific risk be diversified away by investing in both Polestar Automotive and First Hydrogen 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 First Hydrogen 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 First Hydrogen Corp, you can compare the effects of market volatilities on Polestar Automotive and First Hydrogen 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 First Hydrogen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Polestar Automotive and First Hydrogen.
Diversification Opportunities for Polestar Automotive and First Hydrogen
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Polestar and First is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Polestar Automotive Holding and First Hydrogen Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Hydrogen Corp 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 First Hydrogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Hydrogen Corp has no effect on the direction of Polestar Automotive i.e., Polestar Automotive and First Hydrogen go up and down completely randomly.
Pair Corralation between Polestar Automotive and First Hydrogen
Assuming the 90 days horizon Polestar Automotive Holding is expected to generate 2.22 times more return on investment than First Hydrogen. However, Polestar Automotive is 2.22 times more volatile than First Hydrogen Corp. It trades about 0.04 of its potential returns per unit of risk. First Hydrogen Corp is currently generating about -0.08 per unit of risk. If you would invest 23.00 in Polestar Automotive Holding on November 9, 2024 and sell it today you would lose (2.00) from holding Polestar Automotive Holding or give up 8.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.26% |
| Values | Daily Returns |
Polestar Automotive Holding vs. First Hydrogen Corp
Performance |
| Timeline |
| Polestar Automotive |
| First Hydrogen Corp |
Polestar Automotive and First Hydrogen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Polestar Automotive and First Hydrogen
The main advantage of trading using opposite Polestar Automotive and First Hydrogen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Polestar Automotive position performs unexpectedly, First Hydrogen 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 First Hydrogen will offset losses from the drop in First Hydrogen's long position.| Polestar Automotive vs. Lucid Group | Polestar Automotive vs. Canoo Inc | Polestar Automotive vs. Rivian Automotive | Polestar Automotive vs. Aston Martin Lagonda |
| First Hydrogen vs. BAIC Motor | First Hydrogen vs. Zapp Electric Vehicles | First Hydrogen vs. Guangzhou Automobile Group | First Hydrogen vs. Phoenix Motor Common |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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