Correlation Between Mobileleader CoLtd and CU Medical

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

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

Diversification Opportunities for Mobileleader CoLtd and CU Medical

0.05

Correlation Coefficient

Mobileleader CoLtd  CU Medical

Significant diversification

The 3 months correlation between Mobileleader and 115480 is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Mobileleader CoLtd and CU Medical Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CU Medical Systems and Mobileleader CoLtd 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 Mobileleader CoLtd are associated (or correlated) with CU Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CU Medical Systems has no effect on the direction of Mobileleader CoLtd i.e., Mobileleader CoLtd and CU Medical go up and down completely randomly.

Pair Corralation between Mobileleader CoLtd and CU Medical

Assuming the 90 days trading horizon Mobileleader CoLtd is expected to under-perform the CU Medical. In addition to that, Mobileleader CoLtd is 2.3 times more volatile than CU Medical Systems. It trades about -0.06 of its total potential returns per unit of risk. CU Medical Systems is currently generating about 0.17 per unit of volatility. If you would invest  68,700  in CU Medical Systems on October 22, 2024 and sell it today you would earn a total of  2,200  from holding CU Medical Systems or generate 3.2% return on investment over 90 days.

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

Mobileleader CoLtd  vs.  CU Medical Systems

Mobileleader CoLtd

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mobileleader CoLtd has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Mobileleader CoLtd is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

CU Medical Systems

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CU Medical Systems has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, CU Medical is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Mobileleader CoLtd and CU Medical

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

The idea behind Mobileleader CoLtd and CU Medical Systems 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.