Correlation Between Innoviz Technologies and Data IO

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

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

Diversification Opportunities for Innoviz Technologies and Data IO

0.43

Correlation Coefficient

Innoviz Technologies  Data IO

Very weak diversification

The 3 months correlation between Innoviz and Data is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Innoviz Technologies and Data IO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Data IO 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 Data IO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Data IO has no effect on the direction of Innoviz Technologies i.e., Innoviz Technologies and Data IO go up and down completely randomly.

Pair Corralation between Innoviz Technologies and Data IO

Assuming the 90 days horizon Innoviz Technologies is expected to under-perform the Data IO. In addition to that, Innoviz Technologies is 4.36 times more volatile than Data IO. It trades about -0.06 of its total potential returns per unit of risk. Data IO is currently generating about -0.05 per unit of volatility. If you would invest  283.00  in Data IO on December 28, 2024 and sell it today you would lose (30.00) from holding Data IO or give up 10.6% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.36%
Values	Daily Returns

Innoviz Technologies  vs.  Data IO

Innoviz Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Innoviz Technologies 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 basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Data IO

Risk-Adjusted Performance

Very Weak

Over the last 90 days Data IO has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's forward indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with Innoviz Technologies and Data IO

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

The idea behind Innoviz Technologies and Data IO 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.