Correlation Between XL Fleet and Dana
Can any of the company-specific risk be diversified away by investing in both XL Fleet and Dana 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 XL Fleet and Dana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between XL Fleet Corp and Dana Inc, you can compare the effects of market volatilities on XL Fleet and Dana 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 XL Fleet with a short position of Dana. Check out your portfolio center. Please also check ongoing floating volatility patterns of XL Fleet and Dana.
Diversification Opportunities for XL Fleet and Dana
Poor diversification
The 3 months correlation between XL Fleet and Dana is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding XL Fleet Corp and Dana Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dana Inc and XL Fleet 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 XL Fleet Corp are associated (or correlated) with Dana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dana Inc has no effect on the direction of XL Fleet i.e., XL Fleet and Dana go up and down completely randomly.
Pair Corralation between XL Fleet and Dana
If you would invest 1,003 in Dana Inc on August 30, 2024 and sell it today you would earn a total of 9.00 from holding Dana Inc or generate 0.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.35% |
| Values | Daily Returns |
XL Fleet Corp vs. Dana Inc
Performance |
| Timeline |
| XL Fleet Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Dana Inc |
XL Fleet and Dana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XL Fleet and Dana
The main advantage of trading using opposite XL Fleet and Dana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XL Fleet position performs unexpectedly, Dana 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 Dana will offset losses from the drop in Dana's long position.| XL Fleet vs. First Ship Lease | XL Fleet vs. Logan Ridge Finance | XL Fleet vs. Kaltura | XL Fleet vs. Radcom |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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