Correlation Between EVgo Equity and Dicks Sporting

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

By analyzing existing cross correlation between EVgo Equity Warrants and Dicks Sporting Goods, you can compare the effects of market volatilities on EVgo Equity and Dicks Sporting 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 EVgo Equity with a short position of Dicks Sporting. Check out your portfolio center. Please also check ongoing floating volatility patterns of EVgo Equity and Dicks Sporting.

Diversification Opportunities for EVgo Equity and Dicks Sporting

-0.65

Correlation Coefficient

EVgo Equity  Dicks Sporting

Excellent diversification

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

Pair Corralation between EVgo Equity and Dicks Sporting

Assuming the 90 days horizon EVgo Equity Warrants is expected to under-perform the Dicks Sporting. In addition to that, EVgo Equity is 4.22 times more volatile than Dicks Sporting Goods. It trades about -0.07 of its total potential returns per unit of risk. Dicks Sporting Goods is currently generating about -0.22 per unit of volatility. If you would invest  22,185  in Dicks Sporting Goods on January 29, 2024 and sell it today you would lose (1,473) from holding Dicks Sporting Goods or give up 6.64% of portfolio value over 90 days.

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

EVgo Equity Warrants  vs.  Dicks Sporting Goods

EVgo Equity Warrants

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days EVgo Equity Warrants has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Dicks Sporting Goods

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Dicks Sporting Goods are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain forward-looking signals, Dicks Sporting unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with EVgo Equity and Dicks Sporting

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

The idea behind EVgo Equity Warrants and Dicks Sporting Goods 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.