Correlation Between Xtant Medical and Mobix Labs

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

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

Diversification Opportunities for Xtant Medical and Mobix Labs

-0.12

Correlation Coefficient

Xtant Medical  Mobix Labs

Good diversification

The 3 months correlation between Xtant and Mobix is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Xtant Medical Holdings and Mobix Labs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobix Labs and Xtant Medical 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 Xtant Medical Holdings 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 Xtant Medical i.e., Xtant Medical and Mobix Labs go up and down completely randomly.

Pair Corralation between Xtant Medical and Mobix Labs

Given the investment horizon of 90 days Xtant Medical is expected to generate 1.38 times less return on investment than Mobix Labs. But when comparing it to its historical volatility, Xtant Medical Holdings is 3.67 times less risky than Mobix Labs. It trades about 0.28 of its potential returns per unit of risk. Mobix Labs is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  12.00  in Mobix Labs on October 10, 2024 and sell it today you would earn a total of  1.00  from holding Mobix Labs or generate 8.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Xtant Medical Holdings  vs.  Mobix Labs

Xtant Medical Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Xtant Medical Holdings 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 stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Mobix Labs

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Mobix Labs are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly conflicting basic indicators, Mobix Labs showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Xtant Medical and Mobix Labs

The main advantage of trading using opposite Xtant Medical and Mobix Labs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtant Medical 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 Xtant Medical Holdings 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.

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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.