Correlation Between Mobius Investment and Edinburgh Investment

Can any of the company-specific risk be diversified away by investing in both Mobius Investment and Edinburgh 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 Mobius Investment and Edinburgh Investment 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 Edinburgh Investment Trust, you can compare the effects of market volatilities on Mobius Investment and Edinburgh 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 Mobius Investment with a short position of Edinburgh Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mobius Investment and Edinburgh Investment.

Diversification Opportunities for Mobius Investment and Edinburgh Investment

0.82

Correlation Coefficient

Mobius Investment  Edinburgh Investment

Very poor diversification

The 3 months correlation between Mobius and Edinburgh is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Mobius Investment Trust and Edinburgh Investment Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Edinburgh Investment 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 Edinburgh Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Edinburgh Investment has no effect on the direction of Mobius Investment i.e., Mobius Investment and Edinburgh Investment go up and down completely randomly.

Pair Corralation between Mobius Investment and Edinburgh Investment

Assuming the 90 days trading horizon Mobius Investment Trust is expected to generate 2.08 times more return on investment than Edinburgh Investment. However, Mobius Investment is 2.08 times more volatile than Edinburgh Investment Trust. It trades about 0.27 of its potential returns per unit of risk. Edinburgh Investment Trust is currently generating about 0.27 per unit of risk. If you would invest  11,885  in Mobius Investment Trust on April 20, 2025 and sell it today you would earn a total of  2,165  from holding Mobius Investment Trust or generate 18.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Mobius Investment Trust  vs.  Edinburgh Investment Trust

Mobius Investment Trust

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Mobius Investment Trust are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Mobius Investment unveiled solid returns over the last few months and may actually be approaching a breakup point.

Edinburgh Investment

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Edinburgh Investment Trust are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Edinburgh Investment may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Mobius Investment and Edinburgh Investment

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

The idea behind Mobius Investment Trust and Edinburgh Investment Trust 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.