Correlation Between Mobileye Global and Jiangsu Sainty

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

By analyzing existing cross correlation between Mobileye Global Class and Jiangsu Sainty Corp, you can compare the effects of market volatilities on Mobileye Global and Jiangsu Sainty 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 Mobileye Global with a short position of Jiangsu Sainty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mobileye Global and Jiangsu Sainty.

Diversification Opportunities for Mobileye Global and Jiangsu Sainty

-0.35

Correlation Coefficient

Mobileye Global  Jiangsu Sainty

Very good diversification

The 3 months correlation between Mobileye and Jiangsu is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Mobileye Global Class and Jiangsu Sainty Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Sainty Corp and Mobileye Global 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 Mobileye Global Class are associated (or correlated) with Jiangsu Sainty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Sainty Corp has no effect on the direction of Mobileye Global i.e., Mobileye Global and Jiangsu Sainty go up and down completely randomly.

Pair Corralation between Mobileye Global and Jiangsu Sainty

Given the investment horizon of 90 days Mobileye Global Class is expected to under-perform the Jiangsu Sainty. In addition to that, Mobileye Global is 2.66 times more volatile than Jiangsu Sainty Corp. It trades about -0.08 of its total potential returns per unit of risk. Jiangsu Sainty Corp is currently generating about 0.12 per unit of volatility. If you would invest  420.00  in Jiangsu Sainty Corp on December 25, 2024 and sell it today you would earn a total of  44.00  from holding Jiangsu Sainty Corp or generate 10.48% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	96.61%
Values	Daily Returns

Mobileye Global Class  vs.  Jiangsu Sainty Corp

Mobileye Global Class

Risk-Adjusted Performance

Very Weak

Over the last 90 days Mobileye Global Class has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's essential indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Jiangsu Sainty Corp

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Jiangsu Sainty Corp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Jiangsu Sainty may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Mobileye Global and Jiangsu Sainty

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

The idea behind Mobileye Global Class and Jiangsu Sainty Corp 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.