Correlation Between Bemobi Mobile and General Motors

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

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

Diversification Opportunities for Bemobi Mobile and General Motors

-0.59

Correlation Coefficient

Bemobi Mobile  General Motors

Excellent diversification

The 3 months correlation between Bemobi and General is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Bemobi Mobile Tech and General Motors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on General Motors and Bemobi Mobile 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 Bemobi Mobile Tech are associated (or correlated) with General Motors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of General Motors has no effect on the direction of Bemobi Mobile i.e., Bemobi Mobile and General Motors go up and down completely randomly.

Pair Corralation between Bemobi Mobile and General Motors

Assuming the 90 days trading horizon Bemobi Mobile Tech is expected to generate 0.8 times more return on investment than General Motors. However, Bemobi Mobile Tech is 1.25 times less risky than General Motors. It trades about 0.19 of its potential returns per unit of risk. General Motors is currently generating about -0.07 per unit of risk. If you would invest  1,325  in Bemobi Mobile Tech on December 26, 2024 and sell it today you would earn a total of  346.00  from holding Bemobi Mobile Tech or generate 26.11% return on investment over 90 days.

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

Bemobi Mobile Tech  vs.  General Motors

Bemobi Mobile Tech

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Bemobi Mobile Tech are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Bemobi Mobile unveiled solid returns over the last few months and may actually be approaching a breakup point.

General Motors

Risk-Adjusted Performance

Very Weak

Over the last 90 days General Motors has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Bemobi Mobile and General Motors

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

The idea behind Bemobi Mobile Tech and General Motors 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..