Correlation Between Nano Labs and Mobix Labs

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

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

Diversification Opportunities for Nano Labs and Mobix Labs

0.49

Correlation Coefficient

Nano Labs  Mobix Labs

Very weak diversification

The 3 months correlation between Nano and Mobix is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Nano Labs and Mobix Labs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobix Labs and Nano 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 Nano Labs are associated (or correlated) with Mobix Labs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mobix Labs has no effect on the direction of Nano Labs i.e., Nano Labs and Mobix Labs go up and down completely randomly.

Pair Corralation between Nano Labs and Mobix Labs

Allowing for the 90-day total investment horizon Nano Labs is expected to generate 1.66 times more return on investment than Mobix Labs. However, Nano Labs is 1.66 times more volatile than Mobix Labs. It trades about 0.04 of its potential returns per unit of risk. Mobix Labs is currently generating about -0.01 per unit of risk. If you would invest  1,174  in Nano Labs on September 21, 2024 and sell it today you would lose (328.00) from holding Nano Labs or give up 27.94% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	99.8%
Values	Daily Returns

Nano Labs  vs.  Mobix Labs

Nano Labs

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Nano Labs are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Nano Labs sustained solid returns over the last few months and may actually be approaching a breakup point.

Mobix Labs

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Mobix Labs are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak fundamental drivers, Mobix Labs showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Nano Labs and Mobix Labs

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

The idea behind Nano Labs and Mobix Labs 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.