Correlation Between Innoviz Technologies and Compagnie Gnrale

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

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

Diversification Opportunities for Innoviz Technologies and Compagnie Gnrale

-0.22

Correlation Coefficient

Innoviz Technologies  Compagnie Gnrale

Very good diversification

The 3 months correlation between Innoviz and Compagnie is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Innoviz Technologies and Compagnie Gnrale des in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compagnie Gnrale des and Innoviz 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 Innoviz Technologies are associated (or correlated) with Compagnie Gnrale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compagnie Gnrale des has no effect on the direction of Innoviz Technologies i.e., Innoviz Technologies and Compagnie Gnrale go up and down completely randomly.

Pair Corralation between Innoviz Technologies and Compagnie Gnrale

Given the investment horizon of 90 days Innoviz Technologies is expected to generate 2.44 times more return on investment than Compagnie Gnrale. However, Innoviz Technologies is 2.44 times more volatile than Compagnie Gnrale des. It trades about 0.18 of its potential returns per unit of risk. Compagnie Gnrale des is currently generating about -0.03 per unit of risk. If you would invest  75.00  in Innoviz Technologies on October 23, 2024 and sell it today you would earn a total of  87.00  from holding Innoviz Technologies or generate 116.0% return on investment over 90 days.

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

Innoviz Technologies  vs.  Compagnie Gnrale des

Innoviz Technologies

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Innoviz Technologies are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Innoviz Technologies showed solid returns over the last few months and may actually be approaching a breakup point.

Compagnie Gnrale des

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Compagnie Gnrale des has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Innoviz Technologies and Compagnie Gnrale

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

The idea behind Innoviz Technologies and Compagnie Gnrale des 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.