Correlation Between Hyundai and Mobivity Holdings

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Can any of the company-specific risk be diversified away by investing in both Hyundai and Mobivity Holdings 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 Hyundai and Mobivity Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyundai Motor Co and Mobivity Holdings, you can compare the effects of market volatilities on Hyundai and Mobivity Holdings 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 Hyundai with a short position of Mobivity Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai and Mobivity Holdings.

Diversification Opportunities for Hyundai and Mobivity Holdings

-0.13
  Correlation Coefficient

Good diversification

The 3 months correlation between Hyundai and Mobivity is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Motor Co and Mobivity Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobivity Holdings and Hyundai 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 Hyundai Motor Co are associated (or correlated) with Mobivity Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mobivity Holdings has no effect on the direction of Hyundai i.e., Hyundai and Mobivity Holdings go up and down completely randomly.

Pair Corralation between Hyundai and Mobivity Holdings

Assuming the 90 days horizon Hyundai is expected to generate 84.33 times less return on investment than Mobivity Holdings. But when comparing it to its historical volatility, Hyundai Motor Co is 4.01 times less risky than Mobivity Holdings. It trades about 0.01 of its potential returns per unit of risk. Mobivity Holdings is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  27.00  in Mobivity Holdings on October 9, 2024 and sell it today you would earn a total of  15.00  from holding Mobivity Holdings or generate 55.56% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy97.5%
ValuesDaily Returns

Hyundai Motor Co  vs.  Mobivity Holdings

 Performance 
       Timeline  
Hyundai Motor 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Hyundai Motor Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.
Mobivity Holdings 

Risk-Adjusted Performance

11 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Mobivity Holdings are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile basic indicators, Mobivity Holdings displayed solid returns over the last few months and may actually be approaching a breakup point.

Hyundai and Mobivity Holdings Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Hyundai and Mobivity Holdings

The main advantage of trading using opposite Hyundai and Mobivity Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai position performs unexpectedly, Mobivity Holdings 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 Mobivity Holdings will offset losses from the drop in Mobivity Holdings' long position.
The idea behind Hyundai Motor Co and Mobivity 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.

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