Correlation Between EasyJet PLC and Mobius Investment
Can any of the company-specific risk be diversified away by investing in both EasyJet PLC and Mobius Investment 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 EasyJet PLC and Mobius Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EasyJet PLC and Mobius Investment Trust, you can compare the effects of market volatilities on EasyJet PLC and Mobius Investment 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 EasyJet PLC with a short position of Mobius Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of EasyJet PLC and Mobius Investment.
Diversification Opportunities for EasyJet PLC and Mobius Investment
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between EasyJet and Mobius is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding EasyJet PLC and Mobius Investment Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobius Investment Trust and EasyJet PLC 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 EasyJet PLC are associated (or correlated) with Mobius Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mobius Investment Trust has no effect on the direction of EasyJet PLC i.e., EasyJet PLC and Mobius Investment go up and down completely randomly.
Pair Corralation between EasyJet PLC and Mobius Investment
Assuming the 90 days trading horizon EasyJet PLC is expected to under-perform the Mobius Investment. In addition to that, EasyJet PLC is 1.81 times more volatile than Mobius Investment Trust. It trades about -0.39 of its total potential returns per unit of risk. Mobius Investment Trust is currently generating about 0.17 per unit of volatility. If you would invest 14,350 in Mobius Investment Trust on October 27, 2024 and sell it today you would earn a total of 450.00 from holding Mobius Investment Trust or generate 3.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
EasyJet PLC vs. Mobius Investment Trust
Performance |
| Timeline |
| EasyJet PLC |
| Mobius Investment Trust |
EasyJet PLC and Mobius Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EasyJet PLC and Mobius Investment
The main advantage of trading using opposite EasyJet PLC and Mobius Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EasyJet PLC position performs unexpectedly, Mobius Investment 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 Mobius Investment will offset losses from the drop in Mobius Investment's long position.| EasyJet PLC vs. Thor Mining PLC | EasyJet PLC vs. Fortuna Silver Mines | EasyJet PLC vs. Intermediate Capital Group | EasyJet PLC vs. Universal Music Group |
| Mobius Investment vs. New Residential Investment | Mobius Investment vs. Livermore Investments Group | Mobius Investment vs. Canadian General Investments | Mobius Investment vs. Vietnam Enterprise Investments |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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