Correlation Between Mobileye Global and PTC India

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

Diversification Opportunities for Mobileye Global and PTC India

0.8

Correlation Coefficient

Mobileye Global  PTC India

Very poor diversification

The 3 months correlation between Mobileye and PTC is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Mobileye Global Class and PTC India Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PTC India Financial 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 PTC India. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PTC India Financial has no effect on the direction of Mobileye Global i.e., Mobileye Global and PTC India go up and down completely randomly.

Pair Corralation between Mobileye Global and PTC India

Given the investment horizon of 90 days Mobileye Global Class is expected to generate 1.34 times more return on investment than PTC India. However, Mobileye Global is 1.34 times more volatile than PTC India Financial. It trades about -0.07 of its potential returns per unit of risk. PTC India Financial is currently generating about -0.1 per unit of risk. If you would invest  1,851  in Mobileye Global Class on December 22, 2024 and sell it today you would lose (395.00) from holding Mobileye Global Class or give up 21.34% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Mobileye Global Class  vs.  PTC India Financial

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.

PTC India Financial

Risk-Adjusted Performance

Very Weak

Over the last 90 days PTC India Financial 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 technical and fundamental indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Mobileye Global and PTC India

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

The idea behind Mobileye Global Class and PTC India Financial 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.