Correlation Between Spire Global and VIVENDI UNSPONARD

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

By analyzing existing cross correlation between Spire Global and VIVENDI UNSPONARD EO, you can compare the effects of market volatilities on Spire Global and VIVENDI UNSPONARD 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 VIVENDI UNSPONARD. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spire Global and VIVENDI UNSPONARD.

Diversification Opportunities for Spire Global and VIVENDI UNSPONARD

-0.89

Correlation Coefficient

Spire Global  VIVENDI UNSPONARD

Pay attention - limited upside

The 3 months correlation between Spire and VIVENDI is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding Spire Global and VIVENDI UNSPONARD EO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VIVENDI UNSPONARD 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 VIVENDI UNSPONARD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VIVENDI UNSPONARD has no effect on the direction of Spire Global i.e., Spire Global and VIVENDI UNSPONARD go up and down completely randomly.

Pair Corralation between Spire Global and VIVENDI UNSPONARD

Given the investment horizon of 90 days Spire Global is expected to generate 2.9 times more return on investment than VIVENDI UNSPONARD. However, Spire Global is 2.9 times more volatile than VIVENDI UNSPONARD EO. It trades about 0.3 of its potential returns per unit of risk. VIVENDI UNSPONARD EO is currently generating about -0.35 per unit of risk. If you would invest  1,091  in Spire Global on September 5, 2024 and sell it today you would earn a total of  386.00  from holding Spire Global or generate 35.38% return on investment over 90 days.

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

Spire Global  vs.  VIVENDI UNSPONARD EO

Spire Global

Risk-Adjusted Performance

18 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Spire Global are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating forward indicators, Spire Global reported solid returns over the last few months and may actually be approaching a breakup point.

VIVENDI UNSPONARD

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VIVENDI UNSPONARD EO has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Spire Global and VIVENDI UNSPONARD

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

The idea behind Spire Global and VIVENDI UNSPONARD EO 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.