Correlation Between Arrival Vault and Tesla

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

Diversification Opportunities for Arrival Vault and Tesla

0.0

Correlation Coefficient

Arrival Vault  Tesla

Pay attention - limited upside

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

Pair Corralation between Arrival Vault and Tesla

If you would invest (100.00) in Arrival Vault USA on December 29, 2024 and sell it today you would earn a total of  100.00  from holding Arrival Vault USA or generate -100.0% return on investment over 90 days.

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

Arrival Vault USA  vs.  Tesla Inc

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.

Tesla Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Tesla Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's essential indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Arrival Vault and Tesla

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

The idea behind Arrival Vault USA and Tesla Inc 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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.