Correlation Between Genfit SA and Uber Technologies

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Can any of the company-specific risk be diversified away by investing in both Genfit SA and Uber Technologies 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 Genfit SA and Uber Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genfit SA and Uber Technologies, you can compare the effects of market volatilities on Genfit SA and Uber Technologies 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 Genfit SA with a short position of Uber Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genfit SA and Uber Technologies.

Diversification Opportunities for Genfit SA and Uber Technologies

0.77
  Correlation Coefficient

Poor diversification

The 3 months correlation between Genfit and Uber is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Genfit SA and Uber Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uber Technologies and Genfit SA 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 Genfit SA are associated (or correlated) with Uber Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Uber Technologies has no effect on the direction of Genfit SA i.e., Genfit SA and Uber Technologies go up and down completely randomly.

Pair Corralation between Genfit SA and Uber Technologies

Assuming the 90 days trading horizon Genfit SA is expected to generate 0.73 times more return on investment than Uber Technologies. However, Genfit SA is 1.38 times less risky than Uber Technologies. It trades about -0.4 of its potential returns per unit of risk. Uber Technologies is currently generating about -0.33 per unit of risk. If you would invest  392.00  in Genfit SA on September 24, 2024 and sell it today you would lose (49.00) from holding Genfit SA or give up 12.5% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy95.45%
ValuesDaily Returns

Genfit SA  vs.  Uber Technologies

 Performance 
       Timeline  
Genfit SA 

Risk-Adjusted Performance

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Weak
 
Strong
Very Weak
Over the last 90 days Genfit SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.
Uber Technologies 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Uber Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Genfit SA and Uber Technologies Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Genfit SA and Uber Technologies

The main advantage of trading using opposite Genfit SA and Uber Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genfit SA position performs unexpectedly, Uber Technologies 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 Uber Technologies will offset losses from the drop in Uber Technologies' long position.
The idea behind Genfit SA and Uber Technologies 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.

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