Correlation Between Spire Global and Augwind Energy

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

By analyzing existing cross correlation between Spire Global and Augwind Energy Tech, you can compare the effects of market volatilities on Spire Global and Augwind Energy 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 Spire Global with a short position of Augwind Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spire Global and Augwind Energy.

Diversification Opportunities for Spire Global and Augwind Energy

0.43

Correlation Coefficient

Spire Global  Augwind Energy

Very weak diversification

The 3 months correlation between Spire and Augwind is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Spire Global and Augwind Energy Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Augwind Energy Tech and Spire Global 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 Spire Global are associated (or correlated) with Augwind Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Augwind Energy Tech has no effect on the direction of Spire Global i.e., Spire Global and Augwind Energy go up and down completely randomly.

Pair Corralation between Spire Global and Augwind Energy

Given the investment horizon of 90 days Spire Global is expected to generate 2.32 times more return on investment than Augwind Energy. However, Spire Global is 2.32 times more volatile than Augwind Energy Tech. It trades about -0.05 of its potential returns per unit of risk. Augwind Energy Tech is currently generating about -0.15 per unit of risk. If you would invest  1,432  in Spire Global on December 29, 2024 and sell it today you would lose (613.00) from holding Spire Global or give up 42.81% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	85.25%
Values	Daily Returns

Spire Global  vs.  Augwind Energy Tech

Spire Global

Risk-Adjusted Performance

Very Weak

Over the last 90 days Spire Global has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unfluctuating performance in the last few months, the Stock's forward indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Augwind Energy Tech

Risk-Adjusted Performance

Very Weak

Over the last 90 days Augwind Energy Tech has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Spire Global and Augwind Energy

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

The idea behind Spire Global and Augwind Energy Tech 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.