Correlation Between Mobix Labs and SNDL

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

By analyzing existing cross correlation between Mobix Labs and SNDL Inc, you can compare the effects of market volatilities on Mobix Labs and SNDL 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 Mobix Labs with a short position of SNDL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mobix Labs and SNDL.

Diversification Opportunities for Mobix Labs and SNDL

0.01

Correlation Coefficient

Mobix Labs  SNDL

Significant diversification

The 3 months correlation between Mobix and SNDL is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Mobix Labs and SNDL Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SNDL Inc and Mobix Labs 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 Mobix Labs are associated (or correlated) with SNDL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SNDL Inc has no effect on the direction of Mobix Labs i.e., Mobix Labs and SNDL go up and down completely randomly.

Pair Corralation between Mobix Labs and SNDL

Assuming the 90 days horizon Mobix Labs is expected to generate 6.21 times more return on investment than SNDL. However, Mobix Labs is 6.21 times more volatile than SNDL Inc. It trades about 0.04 of its potential returns per unit of risk. SNDL Inc is currently generating about 0.03 per unit of risk. If you would invest  12.00  in Mobix Labs on October 11, 2024 and sell it today you would lose (2.27) from holding Mobix Labs or give up 18.92% of portfolio value over 90 days.

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

Mobix Labs  vs.  SNDL Inc

Mobix Labs

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Mobix Labs are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly conflicting basic indicators, Mobix Labs showed solid returns over the last few months and may actually be approaching a breakup point.

SNDL Inc

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days SNDL Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent fundamental indicators, SNDL is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Mobix Labs and SNDL

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

The idea behind Mobix Labs and SNDL Inc 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.