Correlation Between Spentex Industries and OnMobile Global

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

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

Diversification Opportunities for Spentex Industries and OnMobile Global

0.0

Correlation Coefficient

Spentex Industries  OnMobile Global

Pay attention - limited upside

The 3 months correlation between Spentex and OnMobile is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Spentex Industries Limited and OnMobile Global Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OnMobile Global and Spentex Industries 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 Spentex Industries Limited are associated (or correlated) with OnMobile Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OnMobile Global has no effect on the direction of Spentex Industries i.e., Spentex Industries and OnMobile Global go up and down completely randomly.

Pair Corralation between Spentex Industries and OnMobile Global

Assuming the 90 days trading horizon Spentex Industries Limited is expected to generate 14.64 times more return on investment than OnMobile Global. However, Spentex Industries is 14.64 times more volatile than OnMobile Global Limited. It trades about 0.05 of its potential returns per unit of risk. OnMobile Global Limited is currently generating about -0.01 per unit of risk. If you would invest  165.00  in Spentex Industries Limited on September 28, 2024 and sell it today you would earn a total of  27,835  from holding Spentex Industries Limited or generate 16869.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	87.04%
Values	Daily Returns

Spentex Industries Limited  vs.  OnMobile Global Limited

Spentex Industries

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Spentex Industries Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Spentex Industries is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

OnMobile Global

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days OnMobile Global Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's forward indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Spentex Industries and OnMobile Global

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

The idea behind Spentex Industries Limited and OnMobile Global Limited 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.