Correlation Between Innovid Corp and Telefonica
Can any of the company-specific risk be diversified away by investing in both Innovid Corp and Telefonica 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 Innovid Corp and Telefonica into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innovid Corp and Telefonica SA ADR, you can compare the effects of market volatilities on Innovid Corp and Telefonica 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 Innovid Corp with a short position of Telefonica. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovid Corp and Telefonica.
Diversification Opportunities for Innovid Corp and Telefonica
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Innovid and Telefonica is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Innovid Corp and Telefonica SA ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telefonica SA ADR and Innovid Corp 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 Innovid Corp are associated (or correlated) with Telefonica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telefonica SA ADR has no effect on the direction of Innovid Corp i.e., Innovid Corp and Telefonica go up and down completely randomly.
Pair Corralation between Innovid Corp and Telefonica
Considering the 90-day investment horizon Innovid Corp is expected to generate 4.29 times more return on investment than Telefonica. However, Innovid Corp is 4.29 times more volatile than Telefonica SA ADR. It trades about 0.04 of its potential returns per unit of risk. Telefonica SA ADR is currently generating about 0.13 per unit of risk. If you would invest 194.00 in Innovid Corp on March 13, 2024 and sell it today you would earn a total of 12.00 from holding Innovid Corp or generate 6.19% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Innovid Corp vs. Telefonica SA ADR
Performance |
Timeline |
Innovid Corp |
Telefonica SA ADR |
Innovid Corp and Telefonica Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Innovid Corp and Telefonica
The main advantage of trading using opposite Innovid Corp and Telefonica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innovid Corp position performs unexpectedly, Telefonica 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 Telefonica will offset losses from the drop in Telefonica's long position.Innovid Corp vs. AdTheorent Holding | Innovid Corp vs. ADS TEC ENERGY PLC | Innovid Corp vs. CompoSecure | Innovid Corp vs. Dave Warrants |
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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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