Correlation Between Doubledown InteractiveCo and Mobile Global

Can any of the company-specific risk be diversified away by investing in both Doubledown InteractiveCo and Mobile Global 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 Doubledown InteractiveCo and Mobile Global into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Doubledown InteractiveCo and Mobile Global Esports, you can compare the effects of market volatilities on Doubledown InteractiveCo and Mobile Global 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 Doubledown InteractiveCo with a short position of Mobile Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Doubledown InteractiveCo and Mobile Global.

Diversification Opportunities for Doubledown InteractiveCo and Mobile Global

-0.12

Correlation Coefficient

Doubledown InteractiveCo  Mobile Global

Good diversification

The 3 months correlation between Doubledown and Mobile is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Doubledown InteractiveCo and Mobile Global Esports in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobile Global Esports and Doubledown InteractiveCo 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 Doubledown InteractiveCo are associated (or correlated) with Mobile Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mobile Global Esports has no effect on the direction of Doubledown InteractiveCo i.e., Doubledown InteractiveCo and Mobile Global go up and down completely randomly.

Pair Corralation between Doubledown InteractiveCo and Mobile Global

Considering the 90-day investment horizon Doubledown InteractiveCo is expected to generate 0.16 times more return on investment than Mobile Global. However, Doubledown InteractiveCo is 6.19 times less risky than Mobile Global. It trades about -0.01 of its potential returns per unit of risk. Mobile Global Esports is currently generating about -0.19 per unit of risk. If you would invest  1,145  in Doubledown InteractiveCo on January 29, 2024 and sell it today you would lose (33.00) from holding Doubledown InteractiveCo or give up 2.88% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	76.19%
Values	Daily Returns

Doubledown InteractiveCo  vs.  Mobile Global Esports

Doubledown InteractiveCo

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Doubledown InteractiveCo are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly abnormal fundamental indicators, Doubledown InteractiveCo demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Mobile Global Esports

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mobile Global Esports has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in May 2024. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Doubledown InteractiveCo and Mobile Global

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

The idea behind Doubledown InteractiveCo and Mobile Global Esports 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.

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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.