Correlation Between AIR LIQUIDE and QUEEN S
Can any of the company-specific risk be diversified away by investing in both AIR LIQUIDE and QUEEN S 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 AIR LIQUIDE and QUEEN S into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AIR LIQUIDE ADR and QUEEN S ROAD, you can compare the effects of market volatilities on AIR LIQUIDE and QUEEN S 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 AIR LIQUIDE with a short position of QUEEN S. Check out your portfolio center. Please also check ongoing floating volatility patterns of AIR LIQUIDE and QUEEN S.
Diversification Opportunities for AIR LIQUIDE and QUEEN S
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between AIR and QUEEN is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding AIR LIQUIDE ADR and QUEEN S ROAD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QUEEN S ROAD and AIR LIQUIDE 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 AIR LIQUIDE ADR are associated (or correlated) with QUEEN S. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QUEEN S ROAD has no effect on the direction of AIR LIQUIDE i.e., AIR LIQUIDE and QUEEN S go up and down completely randomly.
Pair Corralation between AIR LIQUIDE and QUEEN S
Assuming the 90 days trading horizon AIR LIQUIDE ADR is expected to under-perform the QUEEN S. But the stock apears to be less risky and, when comparing its historical volatility, AIR LIQUIDE ADR is 3.89 times less risky than QUEEN S. The stock trades about -0.24 of its potential returns per unit of risk. The QUEEN S ROAD is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 52.00 in QUEEN S ROAD on August 28, 2024 and sell it today you would lose (2.00) from holding QUEEN S ROAD or give up 3.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AIR LIQUIDE ADR vs. QUEEN S ROAD
Performance |
| Timeline |
| AIR LIQUIDE ADR |
| QUEEN S ROAD |
AIR LIQUIDE and QUEEN S Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AIR LIQUIDE and QUEEN S
The main advantage of trading using opposite AIR LIQUIDE and QUEEN S positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AIR LIQUIDE position performs unexpectedly, QUEEN S 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 QUEEN S will offset losses from the drop in QUEEN S's long position.| AIR LIQUIDE vs. Superior Plus Corp | AIR LIQUIDE vs. NMI Holdings | AIR LIQUIDE vs. Origin Agritech | AIR LIQUIDE vs. SIVERS SEMICONDUCTORS AB |
| QUEEN S vs. The Bank of | QUEEN S vs. Superior Plus Corp | QUEEN S vs. NMI Holdings | QUEEN S vs. Origin Agritech |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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