Correlation Between Vivendi SE and News

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

By analyzing existing cross correlation between Vivendi SE and News Corporation, you can compare the effects of market volatilities on Vivendi SE and News 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 Vivendi SE with a short position of News. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vivendi SE and News.

Diversification Opportunities for Vivendi SE and News

0.25

Correlation Coefficient

Vivendi SE  News

Modest diversification

The 3 months correlation between Vivendi and News is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Vivendi SE and News Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on News and Vivendi SE 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 Vivendi SE are associated (or correlated) with News. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of News has no effect on the direction of Vivendi SE i.e., Vivendi SE and News go up and down completely randomly.

Pair Corralation between Vivendi SE and News

Assuming the 90 days horizon Vivendi SE is expected to generate 1.41 times more return on investment than News. However, Vivendi SE is 1.41 times more volatile than News Corporation. It trades about 0.08 of its potential returns per unit of risk. News Corporation is currently generating about -0.03 per unit of risk. If you would invest  251.00  in Vivendi SE on December 29, 2024 and sell it today you would earn a total of  26.00  from holding Vivendi SE or generate 10.36% return on investment over 90 days.

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

Vivendi SE  vs.  News Corp.

Vivendi SE

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Vivendi SE are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Vivendi SE may actually be approaching a critical reversion point that can send shares even higher in April 2025.

News

Risk-Adjusted Performance

Very Weak

Over the last 90 days News Corporation has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, News is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Vivendi SE and News

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

The idea behind Vivendi SE and News Corporation 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.