Correlation Between VivoPower International and Eventide Exponential
Can any of the company-specific risk be diversified away by investing in both VivoPower International and Eventide Exponential 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 VivoPower International and Eventide Exponential into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VivoPower International PLC and Eventide Exponential Technologies, you can compare the effects of market volatilities on VivoPower International and Eventide Exponential 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 VivoPower International with a short position of Eventide Exponential. Check out your portfolio center. Please also check ongoing floating volatility patterns of VivoPower International and Eventide Exponential.
Diversification Opportunities for VivoPower International and Eventide Exponential
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between VivoPower and Eventide is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding VivoPower International PLC and Eventide Exponential Technolog in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eventide Exponential and VivoPower International 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 VivoPower International PLC are associated (or correlated) with Eventide Exponential. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eventide Exponential has no effect on the direction of VivoPower International i.e., VivoPower International and Eventide Exponential go up and down completely randomly.
Pair Corralation between VivoPower International and Eventide Exponential
Given the investment horizon of 90 days VivoPower International PLC is expected to generate 10.68 times more return on investment than Eventide Exponential. However, VivoPower International is 10.68 times more volatile than Eventide Exponential Technologies. It trades about 0.03 of its potential returns per unit of risk. Eventide Exponential Technologies is currently generating about 0.05 per unit of risk. If you would invest 450.00 in VivoPower International PLC on November 1, 2024 and sell it today you would lose (344.00) from holding VivoPower International PLC or give up 76.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
VivoPower International PLC vs. Eventide Exponential Technolog
Performance |
| Timeline |
| VivoPower International |
| Eventide Exponential |
VivoPower International and Eventide Exponential Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VivoPower International and Eventide Exponential
The main advantage of trading using opposite VivoPower International and Eventide Exponential positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VivoPower International position performs unexpectedly, Eventide Exponential 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 Eventide Exponential will offset losses from the drop in Eventide Exponential's long position.| VivoPower International vs. Emeren Group | VivoPower International vs. Tigo Energy | VivoPower International vs. Sunrun Inc | VivoPower International vs. Sunnova Energy International |
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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