Correlation Between Magic Software and Sqs Software
Can any of the company-specific risk be diversified away by investing in both Magic Software and Sqs Software 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 Magic Software and Sqs Software into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Magic Software Enterprises and Sqs Software Quality, you can compare the effects of market volatilities on Magic Software and Sqs Software 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 Magic Software with a short position of Sqs Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magic Software and Sqs Software.
Diversification Opportunities for Magic Software and Sqs Software
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Magic and Sqs is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Magic Software Enterprises and Sqs Software Quality in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sqs Software Quality and Magic Software 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 Magic Software Enterprises are associated (or correlated) with Sqs Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sqs Software Quality has no effect on the direction of Magic Software i.e., Magic Software and Sqs Software go up and down completely randomly.
Pair Corralation between Magic Software and Sqs Software
Assuming the 90 days horizon Magic Software Enterprises is expected to generate 0.69 times more return on investment than Sqs Software. However, Magic Software Enterprises is 1.45 times less risky than Sqs Software. It trades about 0.26 of its potential returns per unit of risk. Sqs Software Quality is currently generating about -0.19 per unit of risk. If you would invest 995.00 in Magic Software Enterprises on September 5, 2024 and sell it today you would earn a total of 175.00 from holding Magic Software Enterprises or generate 17.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Magic Software Enterprises vs. Sqs Software Quality
Performance |
| Timeline |
| Magic Software Enter |
| Sqs Software Quality |
Magic Software and Sqs Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Magic Software and Sqs Software
The main advantage of trading using opposite Magic Software and Sqs Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magic Software position performs unexpectedly, Sqs Software 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 Sqs Software will offset losses from the drop in Sqs Software's long position.| Magic Software vs. Superior Plus Corp | Magic Software vs. NMI Holdings | Magic Software vs. Origin Agritech | Magic Software vs. SIVERS SEMICONDUCTORS AB |
| Sqs Software vs. TOTAL GABON | Sqs Software vs. Walgreens Boots Alliance | Sqs Software vs. Peak Resources Limited |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |