Correlation Between Elong Power and NeoVolta Warrant

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

By analyzing existing cross correlation between Elong Power Holding and NeoVolta Warrant, you can compare the effects of market volatilities on Elong Power and NeoVolta Warrant 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 Elong Power with a short position of NeoVolta Warrant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elong Power and NeoVolta Warrant.

Diversification Opportunities for Elong Power and NeoVolta Warrant

-0.75

Correlation Coefficient

Elong Power  NeoVolta Warrant

Pay attention - limited upside

The 3 months correlation between Elong and NeoVolta is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Elong Power Holding and NeoVolta Warrant in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NeoVolta Warrant and Elong Power 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 Elong Power Holding are associated (or correlated) with NeoVolta Warrant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NeoVolta Warrant has no effect on the direction of Elong Power i.e., Elong Power and NeoVolta Warrant go up and down completely randomly.

Pair Corralation between Elong Power and NeoVolta Warrant

Given the investment horizon of 90 days Elong Power Holding is expected to generate 0.69 times more return on investment than NeoVolta Warrant. However, Elong Power Holding is 1.44 times less risky than NeoVolta Warrant. It trades about 0.06 of its potential returns per unit of risk. NeoVolta Warrant is currently generating about -0.21 per unit of risk. If you would invest  107.00  in Elong Power Holding on October 24, 2024 and sell it today you would earn a total of  4.00  from holding Elong Power Holding or generate 3.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Elong Power Holding  vs.  NeoVolta Warrant

Elong Power Holding

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Elong Power Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

NeoVolta Warrant

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in NeoVolta Warrant are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, NeoVolta Warrant showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Elong Power and NeoVolta Warrant

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

The idea behind Elong Power Holding and NeoVolta Warrant 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.