Correlation Between MKS Instruments and Sobr Safe

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

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

Diversification Opportunities for MKS Instruments and Sobr Safe

-0.2

Correlation Coefficient

MKS Instruments  Sobr Safe

Good diversification

The 3 months correlation between MKS and Sobr is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding MKS Instruments and Sobr Safe in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sobr Safe and MKS Instruments 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 MKS Instruments are associated (or correlated) with Sobr Safe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sobr Safe has no effect on the direction of MKS Instruments i.e., MKS Instruments and Sobr Safe go up and down completely randomly.

Pair Corralation between MKS Instruments and Sobr Safe

Given the investment horizon of 90 days MKS Instruments is expected to generate 0.11 times more return on investment than Sobr Safe. However, MKS Instruments is 9.1 times less risky than Sobr Safe. It trades about -0.02 of its potential returns per unit of risk. Sobr Safe is currently generating about -0.05 per unit of risk. If you would invest  10,924  in MKS Instruments on September 23, 2024 and sell it today you would lose (571.00) from holding MKS Instruments or give up 5.23% of portfolio value over 90 days.

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

MKS Instruments  vs.  Sobr Safe

MKS Instruments

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MKS Instruments has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, MKS Instruments is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

Sobr Safe

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sobr Safe has generated negative risk-adjusted returns adding no value to investors with long positions. Even with uncertain performance in the last few months, the Stock's fundamental drivers remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with MKS Instruments and Sobr Safe

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

The idea behind MKS Instruments and Sobr Safe 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 Stocks Directory module to find actively traded stocks across global markets.