Correlation Between Origin Materials and Freyr Battery

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Origin Materials and Freyr Battery 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 Origin Materials and Freyr Battery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Origin Materials and Freyr Battery, you can compare the effects of market volatilities on Origin Materials and Freyr Battery 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 Origin Materials with a short position of Freyr Battery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Materials and Freyr Battery.

Diversification Opportunities for Origin Materials and Freyr Battery

0.31
  Correlation Coefficient

Weak diversification

The 3 months correlation between Origin and Freyr is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Origin Materials and Freyr Battery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Freyr Battery and Origin Materials 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 Origin Materials are associated (or correlated) with Freyr Battery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Freyr Battery has no effect on the direction of Origin Materials i.e., Origin Materials and Freyr Battery go up and down completely randomly.

Pair Corralation between Origin Materials and Freyr Battery

Given the investment horizon of 90 days Origin Materials is expected to under-perform the Freyr Battery. But the stock apears to be less risky and, when comparing its historical volatility, Origin Materials is 2.34 times less risky than Freyr Battery. The stock trades about -0.3 of its potential returns per unit of risk. The Freyr Battery is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  1,229  in Freyr Battery on July 5, 2022 and sell it today you would earn a total of  195.00  from holding Freyr Battery or generate 15.87% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Origin Materials  vs.  Freyr Battery

 Performance (%) 
       Timeline  
Origin Materials 
Origin Performance
0 of 100
Over the last 90 days Origin Materials has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent technical and fundamental indicators, Origin Materials is not utilizing all of its potentials. The new stock price mess, may contribute to short-term losses for the institutional investors.

Origin Price Channel

Freyr Battery 
Freyr Performance
17 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Freyr Battery are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of fairly conflicting technical and fundamental indicators, Freyr Battery showed solid returns over the last few months and may actually be approaching a breakup point.

Freyr Price Channel

Origin Materials and Freyr Battery Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Origin Materials and Freyr Battery

The main advantage of trading using opposite Origin Materials and Freyr Battery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Origin Materials position performs unexpectedly, Freyr Battery 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 Freyr Battery will offset losses from the drop in Freyr Battery's long position.
Origin Materials vs. International Business Machines
The idea behind Origin Materials and Freyr Battery 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.
Freyr Battery vs. Amazon Inc
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 Bond Directory module to find actively traded corporate debentures issued by US companies.

Other Complementary Tools

Alpha Finder
Use alpha and beta coefficients to find investment opportunities after accounting for the risk
Go
Cryptocurrency Center
Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency
Go
Portfolio Diagnostics
Use generated alerts and portfolio events aggregator to diagnose current holdings
Go
Equity Forecasting
Use basic forecasting models to generate price predictions and determine price momentum
Go
Bond Directory
Find actively traded corporate debentures issued by US companies
Go
Transaction History
View history of all your transactions and understand their impact on performance
Go
Piotroski F Score
Get Piotroski F Score based on binary analysis strategy of nine different fundamentals
Go
Price Exposure Probability
Analyze equity upside and downside potential for a given time horizon across multiple markets
Go
Portfolio File Import
Quickly import all of your third-party portfolios from your local drive in csv format
Go