Correlation Between SPI Energy and Schibsted ASA
Can any of the company-specific risk be diversified away by investing in both SPI Energy and Schibsted ASA 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 SPI Energy and Schibsted ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPI Energy Co and Schibsted ASA ADR, you can compare the effects of market volatilities on SPI Energy and Schibsted ASA 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 SPI Energy with a short position of Schibsted ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPI Energy and Schibsted ASA.
Diversification Opportunities for SPI Energy and Schibsted ASA
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SPI and Schibsted is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding SPI Energy Co and Schibsted ASA ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schibsted ASA ADR and SPI Energy 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 SPI Energy Co are associated (or correlated) with Schibsted ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schibsted ASA ADR has no effect on the direction of SPI Energy i.e., SPI Energy and Schibsted ASA go up and down completely randomly.
Pair Corralation between SPI Energy and Schibsted ASA
Considering the 90-day investment horizon SPI Energy Co is expected to generate 10.06 times more return on investment than Schibsted ASA. However, SPI Energy is 10.06 times more volatile than Schibsted ASA ADR. It trades about 0.1 of its potential returns per unit of risk. Schibsted ASA ADR is currently generating about 0.04 per unit of risk. If you would invest 40.00 in SPI Energy Co on November 2, 2024 and sell it today you would lose (4.00) from holding SPI Energy Co or give up 10.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 50.0% |
| Values | Daily Returns |
SPI Energy Co vs. Schibsted ASA ADR
Performance |
| Timeline |
| SPI Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
| Schibsted ASA ADR |
SPI Energy and Schibsted ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPI Energy and Schibsted ASA
The main advantage of trading using opposite SPI Energy and Schibsted ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPI Energy position performs unexpectedly, Schibsted ASA 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 Schibsted ASA will offset losses from the drop in Schibsted ASA's long position.| SPI Energy vs. Ascent Solar Technologies, | SPI Energy vs. Emeren Group | SPI Energy vs. Sunrun Inc | SPI Energy vs. Sunnova Energy International |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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