Correlation Between OPmobility and Metalliance

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

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

Diversification Opportunities for OPmobility and Metalliance

0.0

Correlation Coefficient

OPmobility  Metalliance

Pay attention - limited upside

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

Pair Corralation between OPmobility and Metalliance

Assuming the 90 days trading horizon OPmobility SE is expected to under-perform the Metalliance. But the stock apears to be less risky and, when comparing its historical volatility, OPmobility SE is 1.39 times less risky than Metalliance. The stock trades about -0.01 of its potential returns per unit of risk. The Metalliance SA is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest  1,310  in Metalliance SA on October 22, 2024 and sell it today you would lose (460.00) from holding Metalliance SA or give up 35.11% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	97.22%
Values	Daily Returns

OPmobility SE  vs.  Metalliance SA

OPmobility SE

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in OPmobility SE are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak primary indicators, OPmobility sustained solid returns over the last few months and may actually be approaching a breakup point.

Metalliance SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Metalliance SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Metalliance is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with OPmobility and Metalliance

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

The idea behind OPmobility SE and Metalliance SA 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.