Correlation Between Swiss Prime and Mobimo Hldg

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

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

Diversification Opportunities for Swiss Prime and Mobimo Hldg

0.94

Correlation Coefficient

Swiss Prime  Mobimo Hldg

Almost no diversification

The 3 months correlation between Swiss and Mobimo is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Swiss Prime Site and Mobimo Hldg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobimo Hldg and Swiss Prime 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 Swiss Prime Site are associated (or correlated) with Mobimo Hldg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mobimo Hldg has no effect on the direction of Swiss Prime i.e., Swiss Prime and Mobimo Hldg go up and down completely randomly.

Pair Corralation between Swiss Prime and Mobimo Hldg

Assuming the 90 days trading horizon Swiss Prime Site is expected to generate 1.0 times more return on investment than Mobimo Hldg. However, Swiss Prime Site is 1.0 times less risky than Mobimo Hldg. It trades about 0.2 of its potential returns per unit of risk. Mobimo Hldg is currently generating about 0.14 per unit of risk. If you would invest  9,720  in Swiss Prime Site on December 29, 2024 and sell it today you would earn a total of  1,100  from holding Swiss Prime Site or generate 11.32% return on investment over 90 days.

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

Swiss Prime Site  vs.  Mobimo Hldg

Swiss Prime Site

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Swiss Prime Site are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Swiss Prime may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Mobimo Hldg

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Mobimo Hldg are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Mobimo Hldg may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Swiss Prime and Mobimo Hldg

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

The idea behind Swiss Prime Site and Mobimo Hldg 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.