Correlation Between Mobimo Hldg and Zug Estates

Can any of the company-specific risk be diversified away by investing in both Mobimo Hldg and Zug Estates 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 Mobimo Hldg and Zug Estates into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Mobimo Hldg and Zug Estates Holding, you can compare the effects of market volatilities on Mobimo Hldg and Zug Estates 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 Mobimo Hldg with a short position of Zug Estates. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mobimo Hldg and Zug Estates.

Diversification Opportunities for Mobimo Hldg and Zug Estates

0.41

Correlation Coefficient

Mobimo Hldg  Zug Estates

Very weak diversification

The 3 months correlation between Mobimo and Zug is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Mobimo Hldg and Zug Estates Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zug Estates Holding and Mobimo Hldg 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 Mobimo Hldg are associated (or correlated) with Zug Estates. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zug Estates Holding has no effect on the direction of Mobimo Hldg i.e., Mobimo Hldg and Zug Estates go up and down completely randomly.

Pair Corralation between Mobimo Hldg and Zug Estates

Assuming the 90 days trading horizon Mobimo Hldg is expected to generate 0.55 times more return on investment than Zug Estates. However, Mobimo Hldg is 1.83 times less risky than Zug Estates. It trades about 0.33 of its potential returns per unit of risk. Zug Estates Holding is currently generating about -0.04 per unit of risk. If you would invest  28,750  in Mobimo Hldg on October 5, 2024 and sell it today you would earn a total of  950.00  from holding Mobimo Hldg or generate 3.3% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	94.44%
Values	Daily Returns

Mobimo Hldg  vs.  Zug Estates Holding

Mobimo Hldg

Risk-Adjusted Performance

0 of 100

Solid

Over the last 90 days Mobimo Hldg has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly weak basic indicators, Mobimo Hldg may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Zug Estates Holding

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Zug Estates Holding are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Zug Estates may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Mobimo Hldg and Zug Estates

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

The idea behind Mobimo Hldg and Zug Estates Holding 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.

Check out your portfolio center.

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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.