Correlation Between Lion Electric and Risk George

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

By analyzing existing cross correlation between Lion Electric Corp and Risk George Inds, you can compare the effects of market volatilities on Lion Electric and Risk George 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 Lion Electric with a short position of Risk George. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lion Electric and Risk George.

Diversification Opportunities for Lion Electric and Risk George

0.0

Correlation Coefficient

Lion Electric  Risk George

Pay attention - limited upside

The 3 months correlation between Lion and Risk is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Lion Electric Corp and Risk George Inds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Risk George Inds and Lion Electric 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 Lion Electric Corp are associated (or correlated) with Risk George. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Risk George Inds has no effect on the direction of Lion Electric i.e., Lion Electric and Risk George go up and down completely randomly.

Pair Corralation between Lion Electric and Risk George

If you would invest (100.00) in Risk George Inds on September 15, 2024 and sell it today you would earn a total of  100.00  from holding Risk George Inds or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Lion Electric Corp  vs.  Risk George Inds

Lion Electric Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Lion Electric Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's technical and fundamental indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Risk George Inds

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Risk George Inds has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong forward indicators, Risk George is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Lion Electric and Risk George

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

The idea behind Lion Electric Corp and Risk George Inds 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.