Correlation Between Mobius Investment and Scandic Hotels
Can any of the company-specific risk be diversified away by investing in both Mobius Investment and Scandic Hotels 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 Mobius Investment and Scandic Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mobius Investment Trust and Scandic Hotels Group, you can compare the effects of market volatilities on Mobius Investment and Scandic Hotels 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 Mobius Investment with a short position of Scandic Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mobius Investment and Scandic Hotels.
Diversification Opportunities for Mobius Investment and Scandic Hotels
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Mobius and Scandic is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Mobius Investment Trust and Scandic Hotels Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scandic Hotels Group and Mobius Investment 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 Mobius Investment Trust are associated (or correlated) with Scandic Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scandic Hotels Group has no effect on the direction of Mobius Investment i.e., Mobius Investment and Scandic Hotels go up and down completely randomly.
Pair Corralation between Mobius Investment and Scandic Hotels
Assuming the 90 days trading horizon Mobius Investment Trust is expected to under-perform the Scandic Hotels. But the stock apears to be less risky and, when comparing its historical volatility, Mobius Investment Trust is 1.92 times less risky than Scandic Hotels. The stock trades about -0.32 of its potential returns per unit of risk. The Scandic Hotels Group is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 7,605 in Scandic Hotels Group on November 30, 2024 and sell it today you would earn a total of 870.00 from holding Scandic Hotels Group or generate 11.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mobius Investment Trust vs. Scandic Hotels Group
Performance |
| Timeline |
| Mobius Investment Trust |
| Scandic Hotels Group |
Mobius Investment and Scandic Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mobius Investment and Scandic Hotels
The main advantage of trading using opposite Mobius Investment and Scandic Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mobius Investment position performs unexpectedly, Scandic Hotels 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 Scandic Hotels will offset losses from the drop in Scandic Hotels' long position.| Mobius Investment vs. Zoom Video Communications | ||
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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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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