Correlation Between Spire Global and Nationwide Amundi
Can any of the company-specific risk be diversified away by investing in both Spire Global and Nationwide Amundi 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 Nationwide Amundi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Spire Global and Nationwide Amundi Strategic, you can compare the effects of market volatilities on Spire Global and Nationwide Amundi 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 Nationwide Amundi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spire Global and Nationwide Amundi.
Diversification Opportunities for Spire Global and Nationwide Amundi
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Spire and Nationwide is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Spire Global and Nationwide Amundi Strategic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nationwide Amundi 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 Nationwide Amundi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nationwide Amundi has no effect on the direction of Spire Global i.e., Spire Global and Nationwide Amundi go up and down completely randomly.
Pair Corralation between Spire Global and Nationwide Amundi
Given the investment horizon of 90 days Spire Global is expected to generate 48.69 times more return on investment than Nationwide Amundi. However, Spire Global is 48.69 times more volatile than Nationwide Amundi Strategic. It trades about 0.05 of its potential returns per unit of risk. Nationwide Amundi Strategic is currently generating about 0.3 per unit of risk. If you would invest 960.00 in Spire Global on September 5, 2024 and sell it today you would earn a total of 517.00 from holding Spire Global or generate 53.85% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 99.8% |
Values | Daily Returns |
Spire Global vs. Nationwide Amundi Strategic
Performance |
Timeline |
Spire Global |
Nationwide Amundi |
Spire Global and Nationwide Amundi Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Spire Global and Nationwide Amundi
The main advantage of trading using opposite Spire Global and Nationwide Amundi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spire Global position performs unexpectedly, Nationwide Amundi 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 Nationwide Amundi will offset losses from the drop in Nationwide Amundi's long position.Spire Global vs. Lichen China Limited | Spire Global vs. Unifirst | Spire Global vs. First Advantage Corp | Spire Global vs. Performant Financial |
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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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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