Correlation Between Arrival Vault and Nio

Can any of the company-specific risk be diversified away by investing in both Arrival Vault and Nio 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 Nio 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 Nio Class A, you can compare the effects of market volatilities on Arrival Vault and Nio 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 Nio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arrival Vault and Nio.

Diversification Opportunities for Arrival Vault and Nio

0.0

Correlation Coefficient

Arrival Vault  Nio

Pay attention - limited upside

The 3 months correlation between Arrival and Nio is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Arrival Vault USA and Nio Class A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nio Class A 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 Nio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nio Class A has no effect on the direction of Arrival Vault i.e., Arrival Vault and Nio go up and down completely randomly.

Pair Corralation between Arrival Vault and Nio

If you would invest  438.00  in Nio Class A on December 28, 2024 and sell it today you would lose (16.00) from holding Nio Class A or give up 3.65% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Arrival Vault USA  vs.  Nio Class A

Arrival Vault USA

Risk-Adjusted Performance

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.

Nio Class A

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nio Class A has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy forward indicators, Nio is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Arrival Vault and Nio

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

The idea behind Arrival Vault USA and Nio Class A 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.