Correlation Between Arrival Vault and Xpeng

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

Diversification Opportunities for Arrival Vault and Xpeng

0.0

Correlation Coefficient

Arrival Vault  Xpeng

Pay attention - limited upside

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

Pair Corralation between Arrival Vault and Xpeng

If you would invest  1,187  in Xpeng Inc on December 29, 2024 and sell it today you would earn a total of  783.00  from holding Xpeng Inc or generate 65.96% 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.  Xpeng 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.

Xpeng Inc

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Xpeng Inc are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak technical and fundamental indicators, Xpeng showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Arrival Vault and Xpeng

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

The idea behind Arrival Vault USA and Xpeng 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.

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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.