Correlation Between Vodafone Group and Radius Global

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

By analyzing existing cross correlation between Vodafone Group PLC and Radius Global Infrastructure, you can compare the effects of market volatilities on Vodafone Group and Radius Global 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 Vodafone Group with a short position of Radius Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vodafone Group and Radius Global.

Diversification Opportunities for Vodafone Group and Radius Global

0.0

Correlation Coefficient

Vodafone Group  Radius Global

Pay attention - limited upside

The 3 months correlation between Vodafone and Radius is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Vodafone Group PLC and Radius Global Infrastructure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Radius Global Infras and Vodafone Group 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 Vodafone Group PLC are associated (or correlated) with Radius Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Radius Global Infras has no effect on the direction of Vodafone Group i.e., Vodafone Group and Radius Global go up and down completely randomly.

Pair Corralation between Vodafone Group and Radius Global

If you would invest  839.00  in Vodafone Group PLC on December 20, 2024 and sell it today you would earn a total of  139.00  from holding Vodafone Group PLC or generate 16.57% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Vodafone Group PLC  vs.  Radius Global Infrastructure

Vodafone Group PLC

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Vodafone Group PLC are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather abnormal basic indicators, Vodafone Group exhibited solid returns over the last few months and may actually be approaching a breakup point.

Radius Global Infras

Risk-Adjusted Performance

Very Weak

Over the last 90 days Radius Global Infrastructure has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong fundamental indicators, Radius Global is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Vodafone Group and Radius Global

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

The idea behind Vodafone Group PLC and Radius Global Infrastructure 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.