Correlation Between Holley and Hyliion Holdings
Can any of the company-specific risk be diversified away by investing in both Holley and Hyliion Holdings 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 Holley and Hyliion Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Holley Inc and Hyliion Holdings Corp, you can compare the effects of market volatilities on Holley and Hyliion Holdings 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 Holley with a short position of Hyliion Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Holley and Hyliion Holdings.
Diversification Opportunities for Holley and Hyliion Holdings
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Holley and Hyliion is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Holley Inc and Hyliion Holdings Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyliion Holdings Corp and Holley 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 Holley Inc are associated (or correlated) with Hyliion Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyliion Holdings Corp has no effect on the direction of Holley i.e., Holley and Hyliion Holdings go up and down completely randomly.
Pair Corralation between Holley and Hyliion Holdings
Given the investment horizon of 90 days Holley Inc is expected to under-perform the Hyliion Holdings. But the stock apears to be less risky and, when comparing its historical volatility, Holley Inc is 1.46 times less risky than Hyliion Holdings. The stock trades about -0.01 of its potential returns per unit of risk. The Hyliion Holdings Corp is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 142.00 in Hyliion Holdings Corp on March 9, 2025 and sell it today you would earn a total of 15.00 from holding Hyliion Holdings Corp or generate 10.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Holley Inc vs. Hyliion Holdings Corp
Performance |
| Timeline |
| Holley Inc |
| Hyliion Holdings Corp |
Holley and Hyliion Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Holley and Hyliion Holdings
The main advantage of trading using opposite Holley and Hyliion Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Holley position performs unexpectedly, Hyliion Holdings 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 Hyliion Holdings will offset losses from the drop in Hyliion Holdings' long position.| Holley vs. Dorman Products | Holley vs. Monro Muffler Brake | Holley vs. Standard Motor Products | Holley vs. Stoneridge |
| Hyliion Holdings vs. Quantumscape Corp | Hyliion Holdings vs. Mobileye Global Class | Hyliion Holdings vs. Innoviz Technologies | Hyliion Holdings vs. Aeva Technologies, Common |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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