Correlation Between Evolv Technologies and Ebang International

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

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

Diversification Opportunities for Evolv Technologies and Ebang International

-0.54

Correlation Coefficient

Evolv Technologies  Ebang International

Excellent diversification

The 3 months correlation between Evolv and Ebang is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Evolv Technologies Holdings and Ebang International Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ebang International and Evolv 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 Evolv Technologies Holdings are associated (or correlated) with Ebang International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ebang International has no effect on the direction of Evolv Technologies i.e., Evolv Technologies and Ebang International go up and down completely randomly.

Pair Corralation between Evolv Technologies and Ebang International

Given the investment horizon of 90 days Evolv Technologies Holdings is expected to generate 0.64 times more return on investment than Ebang International. However, Evolv Technologies Holdings is 1.56 times less risky than Ebang International. It trades about 0.57 of its potential returns per unit of risk. Ebang International Holdings is currently generating about 0.22 per unit of risk. If you would invest  215.00  in Evolv Technologies Holdings on September 1, 2024 and sell it today you would earn a total of  190.00  from holding Evolv Technologies Holdings or generate 88.37% return on investment over 90 days.

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

Evolv Technologies Holdings  vs.  Ebang International Holdings

Evolv Technologies

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Evolv Technologies Holdings are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak essential indicators, Evolv Technologies showed solid returns over the last few months and may actually be approaching a breakup point.

Ebang International

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Ebang International Holdings are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Ebang International displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Evolv Technologies and Ebang International

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

The idea behind Evolv Technologies Holdings and Ebang International Holdings 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.