Correlation Between Swiss Prime and Mobimo Hldg

Can any of the company-specific risk be diversified away by investing in both Swiss Prime and Mobimo Hldg 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 Swiss Prime and Mobimo Hldg into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Swiss Prime Site and Mobimo Hldg, you can compare the effects of market volatilities on Swiss Prime and Mobimo Hldg 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 Swiss Prime with a short position of Mobimo Hldg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swiss Prime and Mobimo Hldg.

Diversification Opportunities for Swiss Prime and Mobimo Hldg

0.88

Correlation Coefficient

Swiss Prime  Mobimo Hldg

Very poor diversification

The 3 months correlation between Swiss and Mobimo is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Swiss Prime Site and Mobimo Hldg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobimo Hldg and Swiss Prime 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 Swiss Prime Site are associated (or correlated) with Mobimo Hldg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mobimo Hldg has no effect on the direction of Swiss Prime i.e., Swiss Prime and Mobimo Hldg go up and down completely randomly.

Pair Corralation between Swiss Prime and Mobimo Hldg

Assuming the 90 days trading horizon Swiss Prime is expected to generate 2.87 times less return on investment than Mobimo Hldg. But when comparing it to its historical volatility, Swiss Prime Site is 1.06 times less risky than Mobimo Hldg. It trades about 0.06 of its potential returns per unit of risk. Mobimo Hldg is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  26,750  in Mobimo Hldg on September 24, 2024 and sell it today you would earn a total of  2,100  from holding Mobimo Hldg or generate 7.85% return on investment over 90 days.

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

Swiss Prime Site  vs.  Mobimo Hldg

Swiss Prime Site

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Swiss Prime Site are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Swiss Prime is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Mobimo Hldg

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Mobimo Hldg are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Mobimo Hldg may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Swiss Prime and Mobimo Hldg

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

The idea behind Swiss Prime Site and Mobimo Hldg 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.