Correlation Between Mobileye Global and GCM Mining

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

Diversification Opportunities for Mobileye Global and GCM Mining

-0.61

Correlation Coefficient

Mobileye Global  GCM Mining

Excellent diversification

The 3 months correlation between Mobileye and GCM is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Mobileye Global Class and GCM Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GCM Mining 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 GCM Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GCM Mining Corp has no effect on the direction of Mobileye Global i.e., Mobileye Global and GCM Mining go up and down completely randomly.

Pair Corralation between Mobileye Global and GCM Mining

If you would invest  1,751  in Mobileye Global Class on October 8, 2024 and sell it today you would earn a total of  419.00  from holding Mobileye Global Class or generate 23.93% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	5.26%
Values	Daily Returns

Mobileye Global Class  vs.  GCM Mining Corp

Mobileye Global Class

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Mobileye Global Class are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain essential indicators, Mobileye Global showed solid returns over the last few months and may actually be approaching a breakup point.

GCM Mining Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GCM Mining Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, GCM Mining is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Mobileye Global and GCM Mining

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

The idea behind Mobileye Global Class and GCM Mining 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 Stocks Directory module to find actively traded stocks across global markets.