Correlation Between MOBA Network and Novotek AB

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

By analyzing existing cross correlation between MOBA Network publ and Novotek AB, you can compare the effects of market volatilities on MOBA Network and Novotek AB 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 MOBA Network with a short position of Novotek AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of MOBA Network and Novotek AB.

Diversification Opportunities for MOBA Network and Novotek AB

-0.24

Correlation Coefficient

MOBA Network  Novotek AB

Very good diversification

The 3 months correlation between MOBA and Novotek is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding MOBA Network publ and Novotek AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Novotek AB and MOBA Network 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 MOBA Network publ are associated (or correlated) with Novotek AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Novotek AB has no effect on the direction of MOBA Network i.e., MOBA Network and Novotek AB go up and down completely randomly.

Pair Corralation between MOBA Network and Novotek AB

Assuming the 90 days trading horizon MOBA Network publ is expected to under-perform the Novotek AB. In addition to that, MOBA Network is 2.13 times more volatile than Novotek AB. It trades about 0.0 of its total potential returns per unit of risk. Novotek AB is currently generating about 0.08 per unit of volatility. If you would invest  7,340  in Novotek AB on December 28, 2024 and sell it today you would earn a total of  600.00  from holding Novotek AB or generate 8.17% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.39%
Values	Daily Returns

MOBA Network publ  vs.  Novotek AB

MOBA Network publ

Risk-Adjusted Performance

Very Weak

Over the last 90 days MOBA Network publ has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, MOBA Network is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Novotek AB

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Novotek AB are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain technical and fundamental indicators, Novotek AB may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with MOBA Network and Novotek AB

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

The idea behind MOBA Network publ and Novotek AB 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 Global Correlations module to find global opportunities by holding instruments from different markets.