Correlation Between Expion360 and Powell Industries
Can any of the company-specific risk be diversified away by investing in both Expion360 and Powell Industries 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 Expion360 and Powell Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Expion360 and Powell Industries, you can compare the effects of market volatilities on Expion360 and Powell Industries 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 Expion360 with a short position of Powell Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Expion360 and Powell Industries.
Diversification Opportunities for Expion360 and Powell Industries
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Expion360 and Powell is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Expion360 and Powell Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Powell Industries and Expion360 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 Expion360 are associated (or correlated) with Powell Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Powell Industries has no effect on the direction of Expion360 i.e., Expion360 and Powell Industries go up and down completely randomly.
Pair Corralation between Expion360 and Powell Industries
Given the investment horizon of 90 days Expion360 is expected to under-perform the Powell Industries. In addition to that, Expion360 is 1.0 times more volatile than Powell Industries. It trades about -0.3 of its total potential returns per unit of risk. Powell Industries is currently generating about 0.11 per unit of volatility. If you would invest 25,922 in Powell Industries on August 27, 2024 and sell it today you would earn a total of 3,066 from holding Powell Industries or generate 11.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Expion360 vs. Powell Industries
Performance |
| Timeline |
| Expion360 |
| Powell Industries |
Expion360 and Powell Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Expion360 and Powell Industries
The main advantage of trading using opposite Expion360 and Powell Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Expion360 position performs unexpectedly, Powell Industries 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 Powell Industries will offset losses from the drop in Powell Industries' long position.| Expion360 vs. FREYR Battery SA | Expion360 vs. Microvast Holdings | Expion360 vs. Chardan NexTech Acquisition | Expion360 vs. Solid Power |
| Powell Industries vs. Kimball Electronics | Powell Industries vs. Hayward Holdings | Powell Industries vs. nVent Electric PLC | Powell Industries vs. Energizer Holdings |
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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