Correlation Between Shyft and Nikola Corp
Can any of the company-specific risk be diversified away by investing in both Shyft and Nikola Corp 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 Shyft and Nikola Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shyft Group and Nikola Corp, you can compare the effects of market volatilities on Shyft and Nikola Corp 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 Shyft with a short position of Nikola Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shyft and Nikola Corp.
Diversification Opportunities for Shyft and Nikola Corp
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shyft and Nikola is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Shyft Group and Nikola Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nikola Corp and Shyft 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 Shyft Group are associated (or correlated) with Nikola Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nikola Corp has no effect on the direction of Shyft i.e., Shyft and Nikola Corp go up and down completely randomly.
Pair Corralation between Shyft and Nikola Corp
Given the investment horizon of 90 days Shyft Group is expected to generate 0.44 times more return on investment than Nikola Corp. However, Shyft Group is 2.27 times less risky than Nikola Corp. It trades about 0.04 of its potential returns per unit of risk. Nikola Corp is currently generating about -0.38 per unit of risk. If you would invest 1,315 in Shyft Group on September 4, 2024 and sell it today you would earn a total of 23.00 from holding Shyft Group or generate 1.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shyft Group vs. Nikola Corp
Performance |
| Timeline |
| Shyft Group |
| Nikola Corp |
Shyft and Nikola Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shyft and Nikola Corp
The main advantage of trading using opposite Shyft and Nikola Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shyft position performs unexpectedly, Nikola Corp 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 Nikola Corp will offset losses from the drop in Nikola Corp's long position.| Shyft vs. Astec Industries | Shyft vs. Hyster Yale Materials Handling | Shyft vs. Manitex International | Shyft vs. Rev Group |
| Nikola Corp vs. AGCO Corporation | Nikola Corp vs. Deere Company | Nikola Corp vs. Lindsay | Nikola Corp vs. Lion Electric Corp |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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