Correlation Between United States and Micromobility

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

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

Diversification Opportunities for United States and Micromobility

0.11

Correlation Coefficient

United States  Micromobility

Average diversification

The 3 months correlation between United and Micromobility is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding United States Steel and Micromobility in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Micromobility and United States 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 United States Steel 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 United States i.e., United States and Micromobility go up and down completely randomly.

Pair Corralation between United States and Micromobility

If you would invest  1.72  in Micromobility on September 29, 2024 and sell it today you would earn a total of  0.00  from holding Micromobility or generate 0.0% return on investment over 90 days.

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

United States Steel  vs.  Micromobility

United States Steel

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days United States Steel has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company 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 United States and Micromobility

The main advantage of trading using opposite United States and Micromobility positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United States 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 United States Steel 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.