Correlation Between Qantas Airways and Imugene
Can any of the company-specific risk be diversified away by investing in both Qantas Airways and Imugene 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 Qantas Airways and Imugene into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Qantas Airways and Imugene, you can compare the effects of market volatilities on Qantas Airways and Imugene 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 Qantas Airways with a short position of Imugene. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qantas Airways and Imugene.
Diversification Opportunities for Qantas Airways and Imugene
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Qantas and Imugene is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Qantas Airways and Imugene in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imugene and Qantas Airways 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 Qantas Airways are associated (or correlated) with Imugene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imugene has no effect on the direction of Qantas Airways i.e., Qantas Airways and Imugene go up and down completely randomly.
Pair Corralation between Qantas Airways and Imugene
Assuming the 90 days trading horizon Qantas Airways is expected to generate 0.3 times more return on investment than Imugene. However, Qantas Airways is 3.38 times less risky than Imugene. It trades about 0.06 of its potential returns per unit of risk. Imugene is currently generating about -0.02 per unit of risk. If you would invest 651.00 in Qantas Airways on November 2, 2024 and sell it today you would earn a total of 288.00 from holding Qantas Airways or generate 44.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Qantas Airways vs. Imugene
Performance |
| Timeline |
| Qantas Airways |
| Imugene |
Qantas Airways and Imugene Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qantas Airways and Imugene
The main advantage of trading using opposite Qantas Airways and Imugene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qantas Airways position performs unexpectedly, Imugene 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 Imugene will offset losses from the drop in Imugene's long position.| Qantas Airways vs. Ora Banda Mining | Qantas Airways vs. Duketon Mining | Qantas Airways vs. Perseus Mining | Qantas Airways vs. Pure Foods Tasmania |
| Imugene vs. Hutchison Telecommunications | Imugene vs. Medical Developments International | Imugene vs. Aurelia Metals | Imugene vs. Actinogen Medical |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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