Correlation Between VSBLTY Groupe and Fobi AI

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

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

Diversification Opportunities for VSBLTY Groupe and Fobi AI

0.3

Correlation Coefficient

VSBLTY Groupe  Fobi AI

Weak diversification

The 3 months correlation between VSBLTY and Fobi is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding VSBLTY Groupe Technologies and Fobi AI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fobi AI and VSBLTY Groupe 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 VSBLTY Groupe Technologies are associated (or correlated) with Fobi AI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fobi AI has no effect on the direction of VSBLTY Groupe i.e., VSBLTY Groupe and Fobi AI go up and down completely randomly.

Pair Corralation between VSBLTY Groupe and Fobi AI

Assuming the 90 days horizon VSBLTY Groupe is expected to generate 13.2 times less return on investment than Fobi AI. But when comparing it to its historical volatility, VSBLTY Groupe Technologies is 5.14 times less risky than Fobi AI. It trades about 0.07 of its potential returns per unit of risk. Fobi AI is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  0.80  in Fobi AI on December 19, 2024 and sell it today you would earn a total of  1.37  from holding Fobi AI or generate 171.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.31%
Values	Daily Returns

VSBLTY Groupe Technologies  vs.  Fobi AI

VSBLTY Groupe Techno

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in VSBLTY Groupe Technologies are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, VSBLTY Groupe reported solid returns over the last few months and may actually be approaching a breakup point.

Fobi AI

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Fobi AI are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile forward indicators, Fobi AI reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with VSBLTY Groupe and Fobi AI

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

The idea behind VSBLTY Groupe Technologies and Fobi AI 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.

Check out your portfolio center.

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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.