Correlation Between Xos and Xpel
Can any of the company-specific risk be diversified away by investing in both Xos and Xpel 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 Xos and Xpel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xos Inc and Xpel Inc, you can compare the effects of market volatilities on Xos and Xpel 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 Xos with a short position of Xpel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xos and Xpel.
Diversification Opportunities for Xos and Xpel
Modest diversification
The 3 months correlation between Xos and Xpel is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Xos Inc and Xpel Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xpel Inc and Xos 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 Xos Inc are associated (or correlated) with Xpel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xpel Inc has no effect on the direction of Xos i.e., Xos and Xpel go up and down completely randomly.
Pair Corralation between Xos and Xpel
Considering the 90-day investment horizon Xos Inc is expected to under-perform the Xpel. In addition to that, Xos is 1.64 times more volatile than Xpel Inc. It trades about -0.11 of its total potential returns per unit of risk. Xpel Inc is currently generating about 0.0 per unit of volatility. If you would invest 4,527 in Xpel Inc on August 23, 2024 and sell it today you would lose (42.00) from holding Xpel Inc or give up 0.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xos Inc vs. Xpel Inc
Performance |
| Timeline |
| Xos Inc |
| Xpel Inc |
Xos and Xpel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xos and Xpel
The main advantage of trading using opposite Xos and Xpel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xos position performs unexpectedly, Xpel 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 Xpel will offset losses from the drop in Xpel's long position.| Xos vs. Lion Electric Corp | Xos vs. Nikola Corp | Xos vs. Wabash National | Xos vs. Hydrofarm Holdings Group |
| Xpel vs. Dorman Products | Xpel vs. Standard Motor Products | Xpel vs. Motorcar Parts of | Xpel vs. Stoneridge |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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