Correlation Between SPI Energy and Anixter International

Can any of the company-specific risk be diversified away by investing in both SPI Energy and Anixter International 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 SPI Energy and Anixter International into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SPI Energy Co and Anixter International, you can compare the effects of market volatilities on SPI Energy and Anixter International 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 SPI Energy with a short position of Anixter International. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPI Energy and Anixter International.

Diversification Opportunities for SPI Energy and Anixter International

0.0

Correlation Coefficient

SPI Energy  Anixter International

Pay attention - limited upside

The 3 months correlation between SPI and Anixter is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SPI Energy Co and Anixter International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anixter International and SPI Energy 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 SPI Energy Co are associated (or correlated) with Anixter International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anixter International has no effect on the direction of SPI Energy i.e., SPI Energy and Anixter International go up and down completely randomly.

Pair Corralation between SPI Energy and Anixter International

If you would invest (100.00) in Anixter International on January 24, 2024 and sell it today you would earn a total of  100.00  from holding Anixter International or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

SPI Energy Co  vs.  Anixter International

SPI Energy

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SPI Energy Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating 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 recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Anixter International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Anixter International has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Anixter International is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with SPI Energy and Anixter International

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

The idea behind SPI Energy Co and Anixter International 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.