Correlation Between FiscalNote Holdings and Grid Dynamics

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

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

Diversification Opportunities for FiscalNote Holdings and Grid Dynamics

0.29

Correlation Coefficient

FiscalNote Holdings  Grid Dynamics

Modest diversification

The 3 months correlation between FiscalNote and Grid is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding FiscalNote Holdings and Grid Dynamics Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grid Dynamics Holdings and FiscalNote Holdings 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 FiscalNote Holdings are associated (or correlated) with Grid Dynamics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grid Dynamics Holdings has no effect on the direction of FiscalNote Holdings i.e., FiscalNote Holdings and Grid Dynamics go up and down completely randomly.

Pair Corralation between FiscalNote Holdings and Grid Dynamics

Given the investment horizon of 90 days FiscalNote Holdings is expected to generate 2.22 times more return on investment than Grid Dynamics. However, FiscalNote Holdings is 2.22 times more volatile than Grid Dynamics Holdings. It trades about -0.02 of its potential returns per unit of risk. Grid Dynamics Holdings is currently generating about -0.22 per unit of risk. If you would invest  64.00  in FiscalNote Holdings on May 26, 2025 and sell it today you would lose (13.00) from holding FiscalNote Holdings or give up 20.31% of portfolio value over 90 days.

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

FiscalNote Holdings  vs.  Grid Dynamics Holdings

FiscalNote Holdings

Risk-Adjusted Performance

Weakest

Over the last 90 days FiscalNote Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Grid Dynamics Holdings

Risk-Adjusted Performance

Weakest

Over the last 90 days Grid Dynamics Holdings 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 very healthy which may send shares a bit higher in September 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with FiscalNote Holdings and Grid Dynamics

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

The idea behind FiscalNote Holdings and Grid Dynamics Holdings 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.