Nikola Corp Stock Volatility

NKLA Stock  USD 9.99  0.01  0.10%   
Nikola Corp has Sharpe Ratio of -0.13, which conveys that the firm had a -0.13% return per unit of risk over the last 3 months. Nikola Corp exposes twenty-four different technical indicators, which can help you to evaluate volatility embedded in its price movement. Please verify Nikola Corp's Mean Deviation of 4.36, risk adjusted performance of (0.11), and Standard Deviation of 7.03 to check out the risk estimate we provide. Key indicators related to Nikola Corp's volatility include:
30 Days Market Risk
Chance Of Distress
30 Days Economic Sensitivity
Nikola Corp Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Nikola daily returns, and it is calculated using variance and standard deviation. We also use Nikola's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Nikola Corp volatility.
  

ESG Sustainability

While most ESG disclosures are voluntary, Nikola Corp's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Nikola Corp's managers and investors.
Environmental
Governance
Social
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Nikola Corp can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game as hey may decide to buy additional stocks of Nikola Corp at lower prices to lower their average cost per share. Similarly, when the prices of Nikola Corp's stock rise, investors can sell out and invest the proceeds in other equities with better opportunities.

Moving together with Nikola Stock

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Moving against Nikola Stock

  0.46GENC Gencor IndustriesPairCorr
  0.44REVG Rev Group Fiscal Year End 11th of December 2024 PairCorr
  0.4CEADW CEA Industries WarrantPairCorr
  0.36HY Hyster Yale MaterialsPairCorr

Nikola Corp Market Sensitivity And Downside Risk

Nikola Corp's beta coefficient measures the volatility of Nikola stock compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Nikola stock's returns against your selected market. In other words, Nikola Corp's beta of 2.03 provides an investor with an approximation of how much risk Nikola Corp stock can potentially add to one of your existing portfolios. Nikola Corp is displaying above-average volatility over the selected time horizon. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Nikola Corp's stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Nikola Corp's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different financial instruments as prices fall.
3 Months Beta |Analyze Nikola Corp Demand Trend
Check current 90 days Nikola Corp correlation with market (Dow Jones Industrial)

Nikola Beta

    
  2.03  
Nikola standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.

Standard Deviation

    
  6.38  
It is essential to understand the difference between upside risk (as represented by Nikola Corp's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Nikola Corp's daily returns or price. Since the actual investment returns on holding a position in nikola stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Nikola Corp.

Using Nikola Put Option to Manage Risk

Put options written on Nikola Corp grant holders of the option the right to sell a specified amount of Nikola Corp at a specified price within a specified time frame. The put buyer has a limited loss and, while not fully unlimited gains, as the price of Nikola Stock cannot fall below zero, the put buyer does gain as the price drops. So, one way investors can hedge Nikola Corp's position is by buying a put option against it. The put option used this way is usually referred to as insurance. If an undesired outcome occurs and loss on holding Nikola Corp will be realized, the loss incurred will be offset by the profits made with the option trade.

Nikola Corp's PUT expiring on 2024-07-19

   Profit   
       Nikola Corp Price At Expiration  

Current Nikola Corp Insurance Chain

DeltaGammaOpen IntExpirationCurrent SpreadLast Price
Put
2024-07-19 PUT at $18.0-0.8080.066412024-07-196.75 - 8.458.65View
Put
2024-07-19 PUT at $15.0-0.75170.070627152024-07-193.6 - 5.555.3View
Put
2024-07-19 PUT at $13.5-0.68950.083132024-07-193.5 - 4.94.38View
Put
2024-07-19 PUT at $13.0-0.82850.103722024-07-192.98 - 3.453.1View
Put
2024-07-19 PUT at $12.0-0.79330.14325202024-07-191.74 - 2.711.83View
Put
2024-07-19 PUT at $11.5-0.78320.180512024-07-191.27 - 2.132.52View
Put
2024-07-19 PUT at $11.0-0.64830.1853892024-07-191.22 - 1.621.44View
Put
2024-07-19 PUT at $10.5-0.53610.1669362024-07-191.06 - 1.261.25View
Put
2024-07-19 PUT at $10.0-0.46280.199663712024-07-190.76 - 0.840.74View
Put
2024-07-19 PUT at $9.5-0.36190.1926982024-07-190.53 - 0.650.54View
Put
2024-07-19 PUT at $9.0-0.27490.1581136282024-07-190.36 - 0.440.35View
View All Nikola Corp Options

Nikola Corp Stock Volatility Analysis

Volatility refers to the frequency at which Nikola Corp stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Nikola Corp's price changes. Investors will then calculate the volatility of Nikola Corp's stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Nikola Corp's volatility:

Historical Volatility

This type of stock volatility measures Nikola Corp's fluctuations based on previous trends. It's commonly used to predict Nikola Corp's future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.

Implied Volatility

This type of volatility provides a positive outlook on future price fluctuations for Nikola Corp's current market price. This means that the stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Nikola Corp's to be redeemed at a future date.
Transformation
The output start index for this execution was zero with a total number of output elements of sixty-one. Nikola Corp Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.

Nikola Corp Projected Return Density Against Market

Given the investment horizon of 90 days the stock has the beta coefficient of 2.0326 . This indicates as the benchmark fluctuates upward, the company is expected to outperform it on average. However, if the benchmark returns are projected to be negative, Nikola Corp will likely underperform.
Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Nikola Corp or Machinery sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Nikola Corp's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Nikola stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Nikola Corp has a negative alpha, implying that the risk taken by holding this instrument is not justified. The company is significantly underperforming the Dow Jones Industrial.
   Predicted Return Density   
       Returns  
Nikola Corp's volatility is measured either by using standard deviation or beta. Standard deviation will reflect the average amount of how nikola stock's price will differ from the mean after some time.To get its calculation, you should first determine the mean price during the specified period then subtract that from each price point.

What Drives a Nikola Corp Price Volatility?

Several factors can influence a stock's market volatility:

Industry

Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.

Political and Economic environment

When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.

The Company's Performance

Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.

Nikola Corp Stock Risk Measures

Given the investment horizon of 90 days the coefficient of variation of Nikola Corp is -754.24. The daily returns are distributed with a variance of 40.67 and standard deviation of 6.38. The mean deviation of Nikola Corp is currently at 4.1. For similar time horizon, the selected benchmark (Dow Jones Industrial) has volatility of 0.61
α
Alpha over Dow Jones
-1.48
β
Beta against Dow Jones2.03
σ
Overall volatility
6.38
Ir
Information ratio -0.2

Nikola Corp Stock Return Volatility

Nikola Corp historical daily return volatility represents how much of Nikola Corp stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The company inherits 6.3776% risk (volatility on return distribution) over the 90 days horizon. By contrast, Dow Jones Industrial accepts 0.5714% volatility on return distribution over the 90 days horizon.
 Performance 
       Timeline  

About Nikola Corp Volatility

Volatility is a rate at which the price of Nikola Corp or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Nikola Corp may increase or decrease. In other words, similar to Nikola's beta indicator, it measures the risk of Nikola Corp and helps estimate the fluctuations that may happen in a short period of time. So if prices of Nikola Corp fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.
Last ReportedProjected for Next Year
Selling And Marketing Expenses1.8 M1.7 M
Market Cap21 B19.9 B
Nikola Corp's stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on Nikola Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much Nikola Corp's price varies over time.

3 ways to utilize Nikola Corp's volatility to invest better

Higher Nikola Corp's stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of Nikola Corp stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. Nikola Corp stock volatility can provide helpful information for making investment decisions in the following ways:
  • Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of Nikola Corp investment. A higher volatility means higher risk and potentially larger changes in value.
  • Identifying Opportunities: High volatility in Nikola Corp's stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
  • Diversification: Understanding how the volatility of Nikola Corp's stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Remember it's essential to remember that stock volatility is just one of many factors to consider when making investment decisions, and it should be used in conjunction with other fundamental and technical analysis tools.

Nikola Corp Investment Opportunity

Nikola Corp has a volatility of 6.38 and is 11.19 times more volatile than Dow Jones Industrial. 56 percent of all equities and portfolios are less risky than Nikola Corp. You can use Nikola Corp to enhance the returns of your portfolios. The stock experiences a normal upward fluctuation. Check odds of Nikola Corp to be traded at $10.49 in 90 days.

Average diversification

The correlation between Nikola Corp and DJI is 0.18 (i.e., Average diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Nikola Corp and DJI in the same portfolio, assuming nothing else is changed.

Nikola Corp Additional Risk Indicators

The analysis of Nikola Corp's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Nikola Corp's investment and either accepting that risk or mitigating it. Along with some common measures of Nikola Corp stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stocks, we recommend comparing similar stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.

Nikola Corp Suggested Diversification Pairs

Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Nikola Corp as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Nikola Corp's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Nikola Corp's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Nikola Corp.

Complementary Tools for Nikola Stock analysis

When running Nikola Corp's price analysis, check to measure Nikola Corp's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Nikola Corp is operating at the current time. Most of Nikola Corp's value examination focuses on studying past and present price action to predict the probability of Nikola Corp's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Nikola Corp's price. Additionally, you may evaluate how the addition of Nikola Corp to your portfolios can decrease your overall portfolio volatility.
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