Correlation Between Arrival Vault and Lucid

Can any of the company-specific risk be diversified away by investing in both Arrival Vault and Lucid 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 Arrival Vault and Lucid into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Arrival Vault USA and Lucid Group, you can compare the effects of market volatilities on Arrival Vault and Lucid 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 Arrival Vault with a short position of Lucid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arrival Vault and Lucid.

Diversification Opportunities for Arrival Vault and Lucid

0.28

Correlation Coefficient

Arrival Vault  Lucid

Modest diversification

The 3 months correlation between Arrival and Lucid is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Arrival Vault USA and Lucid Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lucid Group and Arrival Vault 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 Arrival Vault USA are associated (or correlated) with Lucid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lucid Group has no effect on the direction of Arrival Vault i.e., Arrival Vault and Lucid go up and down completely randomly.

Pair Corralation between Arrival Vault and Lucid

If you would invest  198.00  in Arrival Vault USA on August 30, 2024 and sell it today you would earn a total of  0.00  from holding Arrival Vault USA or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	1.59%
Values	Daily Returns

Arrival Vault USA  vs.  Lucid Group

Arrival Vault USA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Arrival Vault USA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Arrival Vault is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Lucid Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Lucid Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's forward indicators remain rather sound which may send shares a bit higher in December 2024. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Arrival Vault and Lucid

The main advantage of trading using opposite Arrival Vault and Lucid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arrival Vault position performs unexpectedly, Lucid 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 Lucid will offset losses from the drop in Lucid's long position.

The idea behind Arrival Vault USA and Lucid Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.