Correlation Between GrowGeneration Corp and Evgo

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

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

Diversification Opportunities for GrowGeneration Corp and Evgo

0.92

Correlation Coefficient

GrowGeneration Corp  Evgo

Almost no diversification

The 3 months correlation between GrowGeneration and Evgo is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding GrowGeneration Corp and Evgo Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evgo Inc and GrowGeneration Corp 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 GrowGeneration Corp are associated (or correlated) with Evgo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evgo Inc has no effect on the direction of GrowGeneration Corp i.e., GrowGeneration Corp and Evgo go up and down completely randomly.

Pair Corralation between GrowGeneration Corp and Evgo

Given the investment horizon of 90 days GrowGeneration Corp is expected to generate 0.68 times more return on investment than Evgo. However, GrowGeneration Corp is 1.47 times less risky than Evgo. It trades about -0.29 of its potential returns per unit of risk. Evgo Inc is currently generating about -0.28 per unit of risk. If you would invest  208.00  in GrowGeneration Corp on December 1, 2024 and sell it today you would lose (94.00) from holding GrowGeneration Corp or give up 45.19% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

GrowGeneration Corp  vs.  Evgo Inc

GrowGeneration Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days GrowGeneration Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Evgo Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Evgo Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with GrowGeneration Corp and Evgo

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

The idea behind GrowGeneration Corp and Evgo 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.