Correlation Between QURATE RETAIL and CME
Can any of the company-specific risk be diversified away by investing in both QURATE RETAIL and CME 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 QURATE RETAIL and CME into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between QURATE RETAIL INC and CME Group, you can compare the effects of market volatilities on QURATE RETAIL and CME 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 QURATE RETAIL with a short position of CME. Check out your portfolio center. Please also check ongoing floating volatility patterns of QURATE RETAIL and CME.
Diversification Opportunities for QURATE RETAIL and CME
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between QURATE and CME is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding QURATE RETAIL INC and CME Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CME Group and QURATE RETAIL 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 QURATE RETAIL INC are associated (or correlated) with CME. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CME Group has no effect on the direction of QURATE RETAIL i.e., QURATE RETAIL and CME go up and down completely randomly.
Pair Corralation between QURATE RETAIL and CME
Assuming the 90 days trading horizon QURATE RETAIL INC is expected to under-perform the CME. In addition to that, QURATE RETAIL is 4.99 times more volatile than CME Group. It trades about -0.21 of its total potential returns per unit of risk. CME Group is currently generating about -0.01 per unit of volatility. If you would invest 22,310 in CME Group on October 25, 2024 and sell it today you would lose (55.00) from holding CME Group or give up 0.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
QURATE RETAIL INC vs. CME Group
Performance |
| Timeline |
| QURATE RETAIL INC |
| CME Group |
QURATE RETAIL and CME Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with QURATE RETAIL and CME
The main advantage of trading using opposite QURATE RETAIL and CME positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if QURATE RETAIL position performs unexpectedly, CME 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 CME will offset losses from the drop in CME's long position.| QURATE RETAIL vs. KINGBOARD CHEMICAL | QURATE RETAIL vs. X FAB Silicon Foundries | QURATE RETAIL vs. AIR PRODCHEMICALS | QURATE RETAIL vs. TIANDE CHEMICAL |
| CME vs. Choice Hotels International | CME vs. IMPERIAL TOBACCO | CME vs. Park Hotels Resorts | CME vs. NH HOTEL GROUP |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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