Correlation Between Electrameccanica and Fisker
Can any of the company-specific risk be diversified away by investing in both Electrameccanica and Fisker 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 Electrameccanica and Fisker into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electrameccanica Vehicles Corp and Fisker Inc, you can compare the effects of market volatilities on Electrameccanica and Fisker 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 Electrameccanica with a short position of Fisker. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electrameccanica and Fisker.
Diversification Opportunities for Electrameccanica and Fisker
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Electrameccanica and Fisker is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Electrameccanica Vehicles Corp and Fisker Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fisker Inc and Electrameccanica 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 Electrameccanica Vehicles Corp are associated (or correlated) with Fisker. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fisker Inc has no effect on the direction of Electrameccanica i.e., Electrameccanica and Fisker go up and down completely randomly.
Pair Corralation between Electrameccanica and Fisker
Given the investment horizon of 90 days Electrameccanica Vehicles Corp is expected to under-perform the Fisker. In addition to that, Electrameccanica is 1.18 times more volatile than Fisker Inc. It trades about 0.0 of its total potential returns per unit of risk. Fisker Inc is currently generating about 0.01 per unit of volatility. If you would invest 715.00 in Fisker Inc on August 27, 2024 and sell it today you would lose (100.00) from holding Fisker Inc or give up 13.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.37% |
| Values | Daily Returns |
Electrameccanica Vehicles Corp vs. Fisker Inc
Performance |
| Timeline |
| Electrameccanica Veh |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Fisker Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Electrameccanica and Fisker Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electrameccanica and Fisker
The main advantage of trading using opposite Electrameccanica and Fisker positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electrameccanica position performs unexpectedly, Fisker 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 Fisker will offset losses from the drop in Fisker's long position.| Electrameccanica vs. GreenPower Motor | Electrameccanica vs. Workhorse Group | Electrameccanica vs. Cenntro Electric Group | Electrameccanica vs. Volcon 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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