Correlation Between Hannon Armstrong and Mobix Labs
Can any of the company-specific risk be diversified away by investing in both Hannon Armstrong and Mobix Labs 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 Hannon Armstrong and Mobix Labs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hannon Armstrong Sustainable and Mobix Labs, you can compare the effects of market volatilities on Hannon Armstrong and Mobix Labs 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 Hannon Armstrong with a short position of Mobix Labs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hannon Armstrong and Mobix Labs.
Diversification Opportunities for Hannon Armstrong and Mobix Labs
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hannon and Mobix is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Hannon Armstrong Sustainable and Mobix Labs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobix Labs and Hannon Armstrong 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 Hannon Armstrong Sustainable are associated (or correlated) with Mobix Labs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mobix Labs has no effect on the direction of Hannon Armstrong i.e., Hannon Armstrong and Mobix Labs go up and down completely randomly.
Pair Corralation between Hannon Armstrong and Mobix Labs
Given the investment horizon of 90 days Hannon Armstrong is expected to generate 22.86 times less return on investment than Mobix Labs. But when comparing it to its historical volatility, Hannon Armstrong Sustainable is 10.13 times less risky than Mobix Labs. It trades about 0.1 of its potential returns per unit of risk. Mobix Labs is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 8.00 in Mobix Labs on September 12, 2024 and sell it today you would earn a total of 3.81 from holding Mobix Labs or generate 47.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 61.9% |
| Values | Daily Returns |
Hannon Armstrong Sustainable vs. Mobix Labs
Performance |
| Timeline |
| Hannon Armstrong Sus |
| Mobix Labs |
Hannon Armstrong and Mobix Labs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hannon Armstrong and Mobix Labs
The main advantage of trading using opposite Hannon Armstrong and Mobix Labs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hannon Armstrong position performs unexpectedly, Mobix Labs 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 Mobix Labs will offset losses from the drop in Mobix Labs' long position.| Hannon Armstrong vs. Crown Castle | Hannon Armstrong vs. Iron Mountain Incorporated | Hannon Armstrong vs. Digital Realty Trust | Hannon Armstrong vs. SBA Communications Corp |
| Mobix Labs vs. Vodka Brands Corp | Mobix Labs vs. Osaka Steel Co, | Mobix Labs vs. Keurig Dr Pepper | Mobix Labs vs. Century Aluminum |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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