Correlation Between Mobi724 Global and Wabash National

Can any of the company-specific risk be diversified away by investing in both Mobi724 Global and Wabash National 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 Mobi724 Global and Wabash National into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Mobi724 Global Solutions and Wabash National, you can compare the effects of market volatilities on Mobi724 Global and Wabash National 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 Mobi724 Global with a short position of Wabash National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mobi724 Global and Wabash National.

Diversification Opportunities for Mobi724 Global and Wabash National

-0.58

Correlation Coefficient

Mobi724 Global  Wabash National

Excellent diversification

The 3 months correlation between Mobi724 and Wabash is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Mobi724 Global Solutions and Wabash National in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wabash National and Mobi724 Global 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 Mobi724 Global Solutions are associated (or correlated) with Wabash National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wabash National has no effect on the direction of Mobi724 Global i.e., Mobi724 Global and Wabash National go up and down completely randomly.

Pair Corralation between Mobi724 Global and Wabash National

Assuming the 90 days horizon Mobi724 Global Solutions is expected to under-perform the Wabash National. In addition to that, Mobi724 Global is 1.11 times more volatile than Wabash National. It trades about -0.12 of its total potential returns per unit of risk. Wabash National is currently generating about -0.02 per unit of volatility. If you would invest  1,959  in Wabash National on September 17, 2024 and sell it today you would lose (93.50) from holding Wabash National or give up 4.77% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.46%
Values	Daily Returns

Mobi724 Global Solutions  vs.  Wabash National

Mobi724 Global Solutions

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mobi724 Global Solutions has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's forward indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Wabash National

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Wabash National has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Wabash National is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Mobi724 Global and Wabash National

The main advantage of trading using opposite Mobi724 Global and Wabash National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mobi724 Global position performs unexpectedly, Wabash National 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 Wabash National will offset losses from the drop in Wabash National's long position.

The idea behind Mobi724 Global Solutions and Wabash National 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.