Correlation Between SoFi Technologies and Chocoladefabriken

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

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

Diversification Opportunities for SoFi Technologies and Chocoladefabriken

-0.76

Correlation Coefficient

SoFi Technologies  Chocoladefabriken

Pay attention - limited upside

The 3 months correlation between SoFi and Chocoladefabriken is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding SoFi Technologies and Chocoladefabriken Lindt Sprngl in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chocoladefabriken Lindt and SoFi 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 SoFi Technologies are associated (or correlated) with Chocoladefabriken. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chocoladefabriken Lindt has no effect on the direction of SoFi Technologies i.e., SoFi Technologies and Chocoladefabriken go up and down completely randomly.

Pair Corralation between SoFi Technologies and Chocoladefabriken

Given the investment horizon of 90 days SoFi Technologies is expected to under-perform the Chocoladefabriken. In addition to that, SoFi Technologies is 1.47 times more volatile than Chocoladefabriken Lindt Sprngli. It trades about -0.05 of its total potential returns per unit of risk. Chocoladefabriken Lindt Sprngli is currently generating about 0.14 per unit of volatility. If you would invest  1,095  in Chocoladefabriken Lindt Sprngli on December 23, 2024 and sell it today you would earn a total of  267.00  from holding Chocoladefabriken Lindt Sprngli or generate 24.38% return on investment over 90 days.

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

SoFi Technologies  vs.  Chocoladefabriken Lindt Sprngl

SoFi Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days SoFi Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's technical and fundamental indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Chocoladefabriken Lindt

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Chocoladefabriken Lindt Sprngli are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Chocoladefabriken showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SoFi Technologies and Chocoladefabriken

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

The idea behind SoFi Technologies and Chocoladefabriken Lindt Sprngli 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.