Correlation Between Bank of Queensland and Kip McGrath
Can any of the company-specific risk be diversified away by investing in both Bank of Queensland and Kip McGrath 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 Bank of Queensland and Kip McGrath into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank of Queensland and Kip McGrath Education, you can compare the effects of market volatilities on Bank of Queensland and Kip McGrath 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 Bank of Queensland with a short position of Kip McGrath. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Queensland and Kip McGrath.
Diversification Opportunities for Bank of Queensland and Kip McGrath
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bank and Kip is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Queensland and Kip McGrath Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kip McGrath Education and Bank of Queensland 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 Bank of Queensland are associated (or correlated) with Kip McGrath. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kip McGrath Education has no effect on the direction of Bank of Queensland i.e., Bank of Queensland and Kip McGrath go up and down completely randomly.
Pair Corralation between Bank of Queensland and Kip McGrath
Assuming the 90 days trading horizon Bank of Queensland is expected to generate 0.29 times more return on investment than Kip McGrath. However, Bank of Queensland is 3.47 times less risky than Kip McGrath. It trades about 0.17 of its potential returns per unit of risk. Kip McGrath Education is currently generating about -0.31 per unit of risk. If you would invest 10,301 in Bank of Queensland on October 11, 2024 and sell it today you would earn a total of 105.00 from holding Bank of Queensland or generate 1.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Bank of Queensland vs. Kip McGrath Education
Performance |
| Timeline |
| Bank of Queensland |
| Kip McGrath Education |
Bank of Queensland and Kip McGrath Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of Queensland and Kip McGrath
The main advantage of trading using opposite Bank of Queensland and Kip McGrath positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of Queensland position performs unexpectedly, Kip McGrath 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 Kip McGrath will offset losses from the drop in Kip McGrath's long position.| Bank of Queensland vs. Ainsworth Game Technology | Bank of Queensland vs. Technology One | Bank of Queensland vs. Actinogen Medical | Bank of Queensland vs. Carawine Resources Limited |
| Kip McGrath vs. Pinnacle Investment Management | Kip McGrath vs. Auctus Alternative Investments | Kip McGrath vs. Spirit Telecom | Kip McGrath vs. MFF Capital Investments |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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