Correlation Between GrowGeneration Corp and Rivian Automotive

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both GrowGeneration Corp and Rivian Automotive 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 Rivian Automotive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GrowGeneration Corp and Rivian Automotive, you can compare the effects of market volatilities on GrowGeneration Corp and Rivian Automotive 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 Rivian Automotive. Check out your portfolio center. Please also check ongoing floating volatility patterns of GrowGeneration Corp and Rivian Automotive.

Diversification Opportunities for GrowGeneration Corp and Rivian Automotive

-0.65
  Correlation Coefficient

Excellent diversification

The 3 months correlation between GrowGeneration and Rivian is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding GrowGeneration Corp and Rivian Automotive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rivian Automotive 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 Rivian Automotive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rivian Automotive has no effect on the direction of GrowGeneration Corp i.e., GrowGeneration Corp and Rivian Automotive go up and down completely randomly.

Pair Corralation between GrowGeneration Corp and Rivian Automotive

Given the investment horizon of 90 days GrowGeneration Corp is expected to under-perform the Rivian Automotive. In addition to that, GrowGeneration Corp is 1.04 times more volatile than Rivian Automotive. It trades about -0.02 of its total potential returns per unit of risk. Rivian Automotive is currently generating about -0.01 per unit of volatility. If you would invest  2,341  in Rivian Automotive on October 4, 2024 and sell it today you would lose (1,011) from holding Rivian Automotive or give up 43.19% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

GrowGeneration Corp  vs.  Rivian Automotive

 Performance 
       Timeline  
GrowGeneration Corp 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days GrowGeneration Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unsteady performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.
Rivian Automotive 

Risk-Adjusted Performance

8 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Rivian Automotive are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Rivian Automotive displayed solid returns over the last few months and may actually be approaching a breakup point.

GrowGeneration Corp and Rivian Automotive Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with GrowGeneration Corp and Rivian Automotive

The main advantage of trading using opposite GrowGeneration Corp and Rivian Automotive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GrowGeneration Corp position performs unexpectedly, Rivian Automotive 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 Rivian Automotive will offset losses from the drop in Rivian Automotive's long position.
The idea behind GrowGeneration Corp and Rivian Automotive 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.

Other Complementary Tools

Sync Your Broker
Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors.
Pair Correlation
Compare performance and examine fundamental relationship between any two equity instruments
Portfolio Rebalancing
Analyze risk-adjusted returns against different time horizons to find asset-allocation targets
Fundamental Analysis
View fundamental data based on most recent published financial statements
Share Portfolio
Track or share privately all of your investments from the convenience of any device