Correlation Between Innoviz Technologies and PowerFleet,

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

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

Diversification Opportunities for Innoviz Technologies and PowerFleet,

-0.4

Correlation Coefficient

Innoviz Technologies  PowerFleet,

Very good diversification

The 3 months correlation between Innoviz and PowerFleet, is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Innoviz Technologies and PowerFleet, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PowerFleet, and Innoviz 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 Innoviz Technologies are associated (or correlated) with PowerFleet,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PowerFleet, has no effect on the direction of Innoviz Technologies i.e., Innoviz Technologies and PowerFleet, go up and down completely randomly.

Pair Corralation between Innoviz Technologies and PowerFleet,

Assuming the 90 days horizon Innoviz Technologies is expected to generate 5.1 times more return on investment than PowerFleet,. However, Innoviz Technologies is 5.1 times more volatile than PowerFleet,. It trades about 0.05 of its potential returns per unit of risk. PowerFleet, is currently generating about 0.16 per unit of risk. If you would invest  16.00  in Innoviz Technologies on September 12, 2024 and sell it today you would lose (7.59) from holding Innoviz Technologies or give up 47.44% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	89.06%
Values	Daily Returns

Innoviz Technologies  vs.  PowerFleet,

Innoviz Technologies

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Innoviz Technologies are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Innoviz Technologies showed solid returns over the last few months and may actually be approaching a breakup point.

PowerFleet,

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in PowerFleet, are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, PowerFleet, unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Innoviz Technologies and PowerFleet,

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

The idea behind Innoviz Technologies and PowerFleet, 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.