Correlation Between Midway and Bank of Queensland
Can any of the company-specific risk be diversified away by investing in both Midway and Bank of Queensland 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 Midway and Bank of Queensland into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Midway and Bank of Queensland, you can compare the effects of market volatilities on Midway and Bank of Queensland 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 Midway with a short position of Bank of Queensland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Midway and Bank of Queensland.
Diversification Opportunities for Midway and Bank of Queensland
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Midway and Bank is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Midway and Bank of Queensland in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Queensland and Midway 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 Midway are associated (or correlated) with Bank of Queensland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of Queensland has no effect on the direction of Midway i.e., Midway and Bank of Queensland go up and down completely randomly.
Pair Corralation between Midway and Bank of Queensland
If you would invest 86.00 in Midway on September 3, 2024 and sell it today you would earn a total of 39.00 from holding Midway or generate 45.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Midway vs. Bank of Queensland
Performance |
| Timeline |
| Midway |
| Bank of Queensland |
Midway and Bank of Queensland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Midway and Bank of Queensland
The main advantage of trading using opposite Midway and Bank of Queensland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Midway position performs unexpectedly, Bank of Queensland 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 Bank of Queensland will offset losses from the drop in Bank of Queensland's long position.| Midway vs. Apiam Animal Health | Midway vs. Sonic Healthcare | Midway vs. Nine Entertainment Co | Midway vs. Kneomedia |
| Bank of Queensland vs. Champion Iron | Bank of Queensland vs. iShares Global Healthcare | Bank of Queensland vs. Ridley | Bank of Queensland vs. Peel Mining |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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