Correlation Between Bemobi Mobile and Lennar

Can any of the company-specific risk be diversified away by investing in both Bemobi Mobile and Lennar 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 Lennar 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 Lennar, you can compare the effects of market volatilities on Bemobi Mobile and Lennar 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 Lennar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bemobi Mobile and Lennar.

Diversification Opportunities for Bemobi Mobile and Lennar

0.4

Correlation Coefficient

Bemobi Mobile  Lennar

Very weak diversification

The 3 months correlation between Bemobi and Lennar is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Bemobi Mobile Tech and Lennar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lennar 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 Lennar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lennar has no effect on the direction of Bemobi Mobile i.e., Bemobi Mobile and Lennar go up and down completely randomly.

Pair Corralation between Bemobi Mobile and Lennar

Assuming the 90 days trading horizon Bemobi Mobile is expected to generate 6.43 times less return on investment than Lennar. But when comparing it to its historical volatility, Bemobi Mobile Tech is 1.02 times less risky than Lennar. It trades about 0.01 of its potential returns per unit of risk. Lennar is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  48,643  in Lennar on October 10, 2024 and sell it today you would earn a total of  33,529  from holding Lennar or generate 68.93% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	86.32%
Values	Daily Returns

Bemobi Mobile Tech  vs.  Lennar

Bemobi Mobile Tech

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Bemobi Mobile Tech are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Bemobi Mobile is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Lennar

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Lennar has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's technical and fundamental indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Bemobi Mobile and Lennar

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

The idea behind Bemobi Mobile Tech and Lennar 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.