Correlation Between Sphere 3D and Autodesk

Can any of the company-specific risk be diversified away by investing in both Sphere 3D and Autodesk 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 Sphere 3D and Autodesk into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Sphere 3D Corp and Autodesk, you can compare the effects of market volatilities on Sphere 3D and Autodesk 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 Sphere 3D with a short position of Autodesk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sphere 3D and Autodesk.

Diversification Opportunities for Sphere 3D and Autodesk

0.53

Correlation Coefficient

Sphere 3D  Autodesk

Very weak diversification

The 3 months correlation between Sphere and Autodesk is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Sphere 3D Corp and Autodesk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autodesk and Sphere 3D 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 Sphere 3D Corp are associated (or correlated) with Autodesk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autodesk has no effect on the direction of Sphere 3D i.e., Sphere 3D and Autodesk go up and down completely randomly.

Pair Corralation between Sphere 3D and Autodesk

Considering the 90-day investment horizon Sphere 3D Corp is expected to under-perform the Autodesk. In addition to that, Sphere 3D is 2.93 times more volatile than Autodesk. It trades about -0.27 of its total potential returns per unit of risk. Autodesk is currently generating about -0.55 per unit of volatility. If you would invest  26,243  in Autodesk on January 20, 2024 and sell it today you would lose (5,180) from holding Autodesk or give up 19.74% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Sphere 3D Corp  vs.  Autodesk

Sphere 3D Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sphere 3D Corp 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 fairly strong which may send shares a bit higher in May 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Autodesk

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Autodesk has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in May 2024. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Sphere 3D and Autodesk

The main advantage of trading using opposite Sphere 3D and Autodesk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sphere 3D position performs unexpectedly, Autodesk 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 Autodesk will offset losses from the drop in Autodesk's long position.

The idea behind Sphere 3D Corp and Autodesk 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.

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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.