Correlation Between NiSource and Contextlogic

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

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

Diversification Opportunities for NiSource and Contextlogic

0.38

Correlation Coefficient

NiSource  Contextlogic

Weak diversification

The 3 months correlation between NiSource and Contextlogic is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding NiSource and Contextlogic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Contextlogic and NiSource 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 NiSource are associated (or correlated) with Contextlogic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Contextlogic has no effect on the direction of NiSource i.e., NiSource and Contextlogic go up and down completely randomly.

Pair Corralation between NiSource and Contextlogic

Allowing for the 90-day total investment horizon NiSource is expected to generate 0.25 times more return on investment than Contextlogic. However, NiSource is 3.94 times less risky than Contextlogic. It trades about 0.15 of its potential returns per unit of risk. Contextlogic is currently generating about 0.01 per unit of risk. If you would invest  3,807  in NiSource on May 12, 2025 and sell it today you would earn a total of  421.00  from holding NiSource or generate 11.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	46.03%
Values	Daily Returns

NiSource  vs.  Contextlogic

NiSource

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in NiSource are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating forward indicators, NiSource may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Contextlogic

Risk-Adjusted Performance

Weakest

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

Pair Trading with NiSource and Contextlogic

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

The idea behind NiSource and Contextlogic 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.