Correlation Between Canoo and Blink Charging
Can any of the company-specific risk be diversified away by investing in both Canoo and Blink Charging 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 Canoo and Blink Charging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Canoo Inc and Blink Charging Co, you can compare the effects of market volatilities on Canoo and Blink Charging 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 Canoo with a short position of Blink Charging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canoo and Blink Charging.
Diversification Opportunities for Canoo and Blink Charging
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Canoo and Blink is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Canoo Inc and Blink Charging Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blink Charging and Canoo 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 Canoo Inc are associated (or correlated) with Blink Charging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blink Charging has no effect on the direction of Canoo i.e., Canoo and Blink Charging go up and down completely randomly.
Pair Corralation between Canoo and Blink Charging
Given the investment horizon of 90 days Canoo Inc is expected to under-perform the Blink Charging. In addition to that, Canoo is 5.13 times more volatile than Blink Charging Co. It trades about -0.21 of its total potential returns per unit of risk. Blink Charging Co is currently generating about -0.16 per unit of volatility. If you would invest 155.00 in Blink Charging Co on December 27, 2024 and sell it today you would lose (62.06) from holding Blink Charging Co or give up 40.04% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 39.34% |
Values | Daily Returns |
Canoo Inc vs. Blink Charging Co
Performance |
Timeline |
Canoo Inc |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Blink Charging |
Canoo and Blink Charging Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Canoo and Blink Charging
The main advantage of trading using opposite Canoo and Blink Charging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canoo position performs unexpectedly, Blink Charging 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 Blink Charging will offset losses from the drop in Blink Charging's long position.Canoo vs. Lucid Group | Canoo vs. Rivian Automotive | Canoo vs. Polestar Automotive Holding | Canoo vs. Mullen Automotive |
Blink Charging vs. Comfort Systems USA | Blink Charging vs. MasTec Inc | Blink Charging vs. EMCOR Group | Blink Charging vs. Granite Construction Incorporated |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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