Correlation Between GE HealthCare and MobileSmith

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

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

Diversification Opportunities for GE HealthCare and MobileSmith

0.0

Correlation Coefficient

GE HealthCare  MobileSmith

Pay attention - limited upside

The 3 months correlation between GEHC and MobileSmith is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GE HealthCare Technologies and MobileSmith in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MobileSmith and GE HealthCare 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 GE HealthCare Technologies are associated (or correlated) with MobileSmith. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MobileSmith has no effect on the direction of GE HealthCare i.e., GE HealthCare and MobileSmith go up and down completely randomly.

Pair Corralation between GE HealthCare and MobileSmith

If you would invest  7,925  in GE HealthCare Technologies on December 22, 2024 and sell it today you would earn a total of  224.00  from holding GE HealthCare Technologies or generate 2.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

GE HealthCare Technologies  vs.  MobileSmith

GE HealthCare Techno

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in GE HealthCare Technologies are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical indicators, GE HealthCare is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

MobileSmith

Risk-Adjusted Performance

Very Weak

Over the last 90 days MobileSmith has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, MobileSmith is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with GE HealthCare and MobileSmith

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

The idea behind GE HealthCare Technologies and MobileSmith 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.