Correlation Between Hawkins and Rivian Automotive
Can any of the company-specific risk be diversified away by investing in both Hawkins 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 Hawkins and Rivian Automotive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hawkins and Rivian Automotive, you can compare the effects of market volatilities on Hawkins 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 Hawkins with a short position of Rivian Automotive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hawkins and Rivian Automotive.
Diversification Opportunities for Hawkins and Rivian Automotive
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hawkins and Rivian is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Hawkins and Rivian Automotive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rivian Automotive and Hawkins 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 Hawkins 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 Hawkins i.e., Hawkins and Rivian Automotive go up and down completely randomly.
Pair Corralation between Hawkins and Rivian Automotive
Given the investment horizon of 90 days Hawkins is expected to under-perform the Rivian Automotive. But the stock apears to be less risky and, when comparing its historical volatility, Hawkins is 1.86 times less risky than Rivian Automotive. The stock trades about -0.14 of its potential returns per unit of risk. The Rivian Automotive is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 1,160 in Rivian Automotive on September 25, 2024 and sell it today you would earn a total of 253.00 from holding Rivian Automotive or generate 21.81% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Hawkins vs. Rivian Automotive
Performance |
Timeline |
Hawkins |
Rivian Automotive |
Hawkins and Rivian Automotive Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hawkins and Rivian Automotive
The main advantage of trading using opposite Hawkins and Rivian Automotive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hawkins 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.Hawkins vs. International Flavors Fragrances | Hawkins vs. Air Products and | Hawkins vs. Linde plc Ordinary | Hawkins vs. PPG Industries |
Rivian Automotive vs. Nio Class A | Rivian Automotive vs. Xpeng Inc | Rivian Automotive vs. Mullen Automotive | Rivian Automotive vs. Tesla Inc |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
Stocks Directory Find actively traded stocks across global markets | |
Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
Content Syndication Quickly integrate customizable finance content to your own investment portal |