Correlation Between Flexion Mobile and MAG Interactive
Can any of the company-specific risk be diversified away by investing in both Flexion Mobile and MAG Interactive 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 Flexion Mobile and MAG Interactive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Flexion Mobile PLC and MAG Interactive AB, you can compare the effects of market volatilities on Flexion Mobile and MAG Interactive 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 Flexion Mobile with a short position of MAG Interactive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flexion Mobile and MAG Interactive.
Diversification Opportunities for Flexion Mobile and MAG Interactive
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Flexion and MAG is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Flexion Mobile PLC and MAG Interactive AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MAG Interactive AB and Flexion Mobile 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 Flexion Mobile PLC are associated (or correlated) with MAG Interactive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MAG Interactive AB has no effect on the direction of Flexion Mobile i.e., Flexion Mobile and MAG Interactive go up and down completely randomly.
Pair Corralation between Flexion Mobile and MAG Interactive
Assuming the 90 days trading horizon Flexion Mobile PLC is expected to generate 1.19 times more return on investment than MAG Interactive. However, Flexion Mobile is 1.19 times more volatile than MAG Interactive AB. It trades about -0.04 of its potential returns per unit of risk. MAG Interactive AB is currently generating about -0.06 per unit of risk. If you would invest 1,350 in Flexion Mobile PLC on August 26, 2024 and sell it today you would lose (612.00) from holding Flexion Mobile PLC or give up 45.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Flexion Mobile PLC vs. MAG Interactive AB
Performance |
| Timeline |
| Flexion Mobile PLC |
| MAG Interactive AB |
Flexion Mobile and MAG Interactive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flexion Mobile and MAG Interactive
The main advantage of trading using opposite Flexion Mobile and MAG Interactive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flexion Mobile position performs unexpectedly, MAG Interactive 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 MAG Interactive will offset losses from the drop in MAG Interactive's long position.| Flexion Mobile vs. Norion Bank | Flexion Mobile vs. Avanza Bank Holding | Flexion Mobile vs. 24SevenOffice Scandinavia AB | Flexion Mobile vs. Svenska Handelsbanken AB |
| MAG Interactive vs. Flexion Mobile PLC | MAG Interactive vs. iZafe Group AB | MAG Interactive vs. KABE Group AB | MAG Interactive vs. IAR Systems Group |
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.
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