Correlation Between Microvast Holdings and AST SpaceMobile

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

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

Diversification Opportunities for Microvast Holdings and AST SpaceMobile

0.0

Correlation Coefficient

Microvast Holdings  AST SpaceMobile

Pay attention - limited upside

The 3 months correlation between Microvast and AST is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Microvast Holdings and AST SpaceMobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AST SpaceMobile and Microvast Holdings 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 Microvast Holdings are associated (or correlated) with AST SpaceMobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AST SpaceMobile has no effect on the direction of Microvast Holdings i.e., Microvast Holdings and AST SpaceMobile go up and down completely randomly.

Pair Corralation between Microvast Holdings and AST SpaceMobile

If you would invest  10.00  in Microvast Holdings on December 1, 2024 and sell it today you would earn a total of  14.00  from holding Microvast Holdings or generate 140.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Microvast Holdings  vs.  AST SpaceMobile

Microvast Holdings

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Microvast Holdings are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, Microvast Holdings showed solid returns over the last few months and may actually be approaching a breakup point.

AST SpaceMobile

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Microvast Holdings and AST SpaceMobile

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

The idea behind Microvast Holdings and AST SpaceMobile 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.