Correlation Between Spire Global and Teka Construction
Can any of the company-specific risk be diversified away by investing in both Spire Global and Teka Construction 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 Teka Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Spire Global and Teka Construction PCL, you can compare the effects of market volatilities on Spire Global and Teka Construction 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 Teka Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spire Global and Teka Construction.
Diversification Opportunities for Spire Global and Teka Construction
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Spire and Teka is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Spire Global and Teka Construction PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teka Construction PCL 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 Teka Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teka Construction PCL has no effect on the direction of Spire Global i.e., Spire Global and Teka Construction go up and down completely randomly.
Pair Corralation between Spire Global and Teka Construction
Given the investment horizon of 90 days Spire Global is expected to generate 2.27 times more return on investment than Teka Construction. However, Spire Global is 2.27 times more volatile than Teka Construction PCL. It trades about 0.08 of its potential returns per unit of risk. Teka Construction PCL is currently generating about 0.03 per unit of risk. If you would invest 1,114 in Spire Global on September 3, 2024 and sell it today you would earn a total of 520.00 from holding Spire Global or generate 46.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.95% |
| Values | Daily Returns |
Spire Global vs. Teka Construction PCL
Performance |
| Timeline |
| Spire Global |
| Teka Construction PCL |
Spire Global and Teka Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Spire Global and Teka Construction
The main advantage of trading using opposite Spire Global and Teka Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spire Global position performs unexpectedly, Teka Construction 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 Teka Construction will offset losses from the drop in Teka Construction's long position.| Spire Global vs. Lichen China Limited | Spire Global vs. Unifirst | Spire Global vs. First Advantage Corp | Spire Global vs. Performant Financial |
| Teka Construction vs. TKrungthai Industries Public | Teka Construction vs. TCM Public | Teka Construction vs. Well Graded Engineering | Teka Construction vs. The Steel Public |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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