Correlation Between Expion360 and Ads Tec

Can any of the company-specific risk be diversified away by investing in both Expion360 and Ads Tec 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 Expion360 and Ads Tec into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Expion360 and Ads Tec Energy, you can compare the effects of market volatilities on Expion360 and Ads Tec 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 Expion360 with a short position of Ads Tec. Check out your portfolio center. Please also check ongoing floating volatility patterns of Expion360 and Ads Tec.

Diversification Opportunities for Expion360 and Ads Tec

0.4

Correlation Coefficient

Expion360  Ads Tec

Very weak diversification

The 3 months correlation between Expion360 and Ads is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Expion360 and Ads Tec Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ads Tec Energy and Expion360 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 Expion360 are associated (or correlated) with Ads Tec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ads Tec Energy has no effect on the direction of Expion360 i.e., Expion360 and Ads Tec go up and down completely randomly.

Pair Corralation between Expion360 and Ads Tec

Given the investment horizon of 90 days Expion360 is expected to under-perform the Ads Tec. In addition to that, Expion360 is 2.34 times more volatile than Ads Tec Energy. It trades about -0.34 of its total potential returns per unit of risk. Ads Tec Energy is currently generating about 0.01 per unit of volatility. If you would invest  1,504  in Ads Tec Energy on December 29, 2024 and sell it today you would lose (6.00) from holding Ads Tec Energy or give up 0.4% of portfolio value over 90 days.

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

Expion360  vs.  Ads Tec Energy

Expion360

Risk-Adjusted Performance

Very Weak

Over the last 90 days Expion360 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 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.

Ads Tec Energy

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ads Tec Energy has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Ads Tec is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Expion360 and Ads Tec

The main advantage of trading using opposite Expion360 and Ads Tec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Expion360 position performs unexpectedly, Ads Tec 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 Ads Tec will offset losses from the drop in Ads Tec's long position.

The idea behind Expion360 and Ads Tec Energy 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 Transaction History module to view history of all your transactions and understand their impact on performance.