Correlation Between Roblox Corp and Mobile Global

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

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

Diversification Opportunities for Roblox Corp and Mobile Global

-0.45

Correlation Coefficient

Roblox Corp  Mobile Global

Very good diversification

The 3 months correlation between Roblox and Mobile is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Roblox Corp and Mobile Global Esports in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobile Global Esports and Roblox Corp 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 Roblox Corp are associated (or correlated) with Mobile Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mobile Global Esports has no effect on the direction of Roblox Corp i.e., Roblox Corp and Mobile Global go up and down completely randomly.

Pair Corralation between Roblox Corp and Mobile Global

Given the investment horizon of 90 days Roblox Corp is expected to generate 3.72 times less return on investment than Mobile Global. But when comparing it to its historical volatility, Roblox Corp is 4.47 times less risky than Mobile Global. It trades about 0.04 of its potential returns per unit of risk. Mobile Global Esports is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  72.00  in Mobile Global Esports on September 3, 2024 and sell it today you would lose (23.00) from holding Mobile Global Esports or give up 31.94% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	30.91%
Values	Daily Returns

Roblox Corp  vs.  Mobile Global Esports

Roblox Corp

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Roblox Corp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak essential indicators, Roblox Corp showed solid returns over the last few months and may actually be approaching a breakup point.

Mobile Global Esports

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mobile Global Esports has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Mobile Global is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Roblox Corp and Mobile Global

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

The idea behind Roblox Corp and Mobile Global Esports 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.