Correlation Between EZGO Technologies and Arcimoto

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

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

Diversification Opportunities for EZGO Technologies and Arcimoto

-0.05

Correlation Coefficient

EZGO Technologies  Arcimoto

Good diversification

The 3 months correlation between EZGO and Arcimoto is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding EZGO Technologies and Arcimoto in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arcimoto and EZGO Technologies 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 EZGO Technologies are associated (or correlated) with Arcimoto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arcimoto has no effect on the direction of EZGO Technologies i.e., EZGO Technologies and Arcimoto go up and down completely randomly.

Pair Corralation between EZGO Technologies and Arcimoto

If you would invest  147.00  in Arcimoto on September 29, 2024 and sell it today you would earn a total of  0.00  from holding Arcimoto or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	0.79%
Values	Daily Returns

EZGO Technologies  vs.  Arcimoto

EZGO Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days EZGO Technologies 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 technical and fundamental indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Arcimoto

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Arcimoto has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Arcimoto is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with EZGO Technologies and Arcimoto

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

The idea behind EZGO Technologies and Arcimoto 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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.