Correlation Between Qbe Insurance and Hansen Technologies
Can any of the company-specific risk be diversified away by investing in both Qbe Insurance and Hansen Technologies 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 Qbe Insurance and Hansen Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Qbe Insurance Group and Hansen Technologies, you can compare the effects of market volatilities on Qbe Insurance and Hansen Technologies 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 Qbe Insurance with a short position of Hansen Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qbe Insurance and Hansen Technologies.
Diversification Opportunities for Qbe Insurance and Hansen Technologies
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Qbe and Hansen is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Qbe Insurance Group and Hansen Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hansen Technologies and Qbe Insurance 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 Qbe Insurance Group are associated (or correlated) with Hansen Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hansen Technologies has no effect on the direction of Qbe Insurance i.e., Qbe Insurance and Hansen Technologies go up and down completely randomly.
Pair Corralation between Qbe Insurance and Hansen Technologies
Assuming the 90 days trading horizon Qbe Insurance Group is expected to generate 0.68 times more return on investment than Hansen Technologies. However, Qbe Insurance Group is 1.48 times less risky than Hansen Technologies. It trades about 0.02 of its potential returns per unit of risk. Hansen Technologies is currently generating about -0.16 per unit of risk. If you would invest 2,000 in Qbe Insurance Group on October 30, 2024 and sell it today you would earn a total of 15.00 from holding Qbe Insurance Group or generate 0.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Qbe Insurance Group vs. Hansen Technologies
Performance |
| Timeline |
| Qbe Insurance Group |
| Hansen Technologies |
Qbe Insurance and Hansen Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qbe Insurance and Hansen Technologies
The main advantage of trading using opposite Qbe Insurance and Hansen Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qbe Insurance position performs unexpectedly, Hansen Technologies 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 Hansen Technologies will offset losses from the drop in Hansen Technologies' long position.| Qbe Insurance vs. Vulcan Steel | Qbe Insurance vs. Stelar Metals | Qbe Insurance vs. Carnegie Clean Energy | Qbe Insurance vs. Centaurus Metals |
| Hansen Technologies vs. Centaurus Metals | Hansen Technologies vs. ACDC Metals | Hansen Technologies vs. Finexia Financial Group | Hansen Technologies vs. Group 6 Metals |
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..
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