Correlation Between Rivian Automotive and Greencity Acquisition
Can any of the company-specific risk be diversified away by investing in both Rivian Automotive and Greencity Acquisition 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 Rivian Automotive and Greencity Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rivian Automotive and Greencity Acquisition, you can compare the effects of market volatilities on Rivian Automotive and Greencity Acquisition 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 Rivian Automotive with a short position of Greencity Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rivian Automotive and Greencity Acquisition.
Diversification Opportunities for Rivian Automotive and Greencity Acquisition
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Rivian and Greencity is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Rivian Automotive and Greencity Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greencity Acquisition and Rivian 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 Rivian Automotive are associated (or correlated) with Greencity Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greencity Acquisition has no effect on the direction of Rivian Automotive i.e., Rivian Automotive and Greencity Acquisition go up and down completely randomly.
Pair Corralation between Rivian Automotive and Greencity Acquisition
Given the investment horizon of 90 days Rivian Automotive is expected to under-perform the Greencity Acquisition. But the stock apears to be less risky and, when comparing its historical volatility, Rivian Automotive is 5.65 times less risky than Greencity Acquisition. The stock trades about -0.02 of its potential returns per unit of risk. The Greencity Acquisition is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1.36 in Greencity Acquisition on August 26, 2024 and sell it today you would earn a total of 0.26 from holding Greencity Acquisition or generate 19.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 10.66% |
| Values | Daily Returns |
Rivian Automotive vs. Greencity Acquisition
Performance |
| Timeline |
| Rivian Automotive |
| Greencity Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Rivian Automotive and Greencity Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rivian Automotive and Greencity Acquisition
The main advantage of trading using opposite Rivian Automotive and Greencity Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rivian Automotive position performs unexpectedly, Greencity Acquisition 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 Greencity Acquisition will offset losses from the drop in Greencity Acquisition's long position.| Rivian Automotive vs. Nio Class A | Rivian Automotive vs. Xpeng Inc | Rivian Automotive vs. Mullen Automotive | Rivian Automotive vs. Tesla 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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