Correlation Between Volkswagen and FinTech Evolution
Can any of the company-specific risk be diversified away by investing in both Volkswagen and FinTech Evolution 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 Volkswagen and FinTech Evolution into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Volkswagen AG and FinTech Evolution Acquisition, you can compare the effects of market volatilities on Volkswagen and FinTech Evolution 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 Volkswagen with a short position of FinTech Evolution. Check out your portfolio center. Please also check ongoing floating volatility patterns of Volkswagen and FinTech Evolution.
Diversification Opportunities for Volkswagen and FinTech Evolution
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Volkswagen and FinTech is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Volkswagen AG and FinTech Evolution Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FinTech Evolution and Volkswagen 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 Volkswagen AG are associated (or correlated) with FinTech Evolution. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FinTech Evolution has no effect on the direction of Volkswagen i.e., Volkswagen and FinTech Evolution go up and down completely randomly.
Pair Corralation between Volkswagen and FinTech Evolution
If you would invest 9,399 in Volkswagen AG on October 21, 2024 and sell it today you would earn a total of 483.00 from holding Volkswagen AG or generate 5.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 5.26% |
| Values | Daily Returns |
Volkswagen AG vs. FinTech Evolution Acquisition
Performance |
| Timeline |
| Volkswagen AG |
| FinTech Evolution |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Volkswagen and FinTech Evolution Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Volkswagen and FinTech Evolution
The main advantage of trading using opposite Volkswagen and FinTech Evolution positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Volkswagen position performs unexpectedly, FinTech Evolution 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 FinTech Evolution will offset losses from the drop in FinTech Evolution's long position.| Volkswagen vs. Bayerische Motoren Werke | Volkswagen vs. Honda Motor Co | Volkswagen vs. Porsche Automobil Holding | Volkswagen vs. Bayerische Motoren Werke |
| FinTech Evolution vs. Summit Therapeutics PLC | FinTech Evolution vs. BRP Inc | FinTech Evolution vs. Nuvalent | FinTech Evolution vs. Genfit |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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