Correlation Between ArcelorMittal and Micromobility

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

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

Diversification Opportunities for ArcelorMittal and Micromobility

0.28

Correlation Coefficient

ArcelorMittal  Micromobility

Modest diversification

The 3 months correlation between ArcelorMittal and Micromobility is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding ArcelorMittal SA ADR and Micromobility in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Micromobility and ArcelorMittal 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 ArcelorMittal SA ADR are associated (or correlated) with Micromobility. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Micromobility has no effect on the direction of ArcelorMittal i.e., ArcelorMittal and Micromobility go up and down completely randomly.

Pair Corralation between ArcelorMittal and Micromobility

If you would invest  2,261  in ArcelorMittal SA ADR on September 29, 2024 and sell it today you would earn a total of  62.00  from holding ArcelorMittal SA ADR or generate 2.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	0.79%
Values	Daily Returns

ArcelorMittal SA ADR  vs.  Micromobility

ArcelorMittal SA ADR

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ArcelorMittal SA ADR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Micromobility

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Micromobility has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable primary indicators, Micromobility is not utilizing all of its potentials. The newest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with ArcelorMittal and Micromobility

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

The idea behind ArcelorMittal SA ADR and Micromobility 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.