Correlation Between QBE Insurance and MTI WIRELESS
Can any of the company-specific risk be diversified away by investing in both QBE Insurance and MTI WIRELESS 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 MTI WIRELESS 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 MTI WIRELESS EDGE, you can compare the effects of market volatilities on QBE Insurance and MTI WIRELESS 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 MTI WIRELESS. Check out your portfolio center. Please also check ongoing floating volatility patterns of QBE Insurance and MTI WIRELESS.
Diversification Opportunities for QBE Insurance and MTI WIRELESS
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between QBE and MTI is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding QBE Insurance Group and MTI WIRELESS EDGE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MTI WIRELESS EDGE 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 MTI WIRELESS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MTI WIRELESS EDGE has no effect on the direction of QBE Insurance i.e., QBE Insurance and MTI WIRELESS go up and down completely randomly.
Pair Corralation between QBE Insurance and MTI WIRELESS
Assuming the 90 days horizon QBE Insurance is expected to generate 80.59 times less return on investment than MTI WIRELESS. But when comparing it to its historical volatility, QBE Insurance Group is 5.04 times less risky than MTI WIRELESS. It trades about 0.01 of its potential returns per unit of risk. MTI WIRELESS EDGE is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 51.00 in MTI WIRELESS EDGE on September 13, 2024 and sell it today you would earn a total of 6.00 from holding MTI WIRELESS EDGE or generate 11.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
QBE Insurance Group vs. MTI WIRELESS EDGE
Performance |
| Timeline |
| QBE Insurance Group |
| MTI WIRELESS EDGE |
QBE Insurance and MTI WIRELESS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with QBE Insurance and MTI WIRELESS
The main advantage of trading using opposite QBE Insurance and MTI WIRELESS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if QBE Insurance position performs unexpectedly, MTI WIRELESS 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 MTI WIRELESS will offset losses from the drop in MTI WIRELESS's long position.| QBE Insurance vs. Insurance Australia Group | QBE Insurance vs. Superior Plus Corp | QBE Insurance vs. SIVERS SEMICONDUCTORS AB | QBE Insurance vs. CHINA HUARONG ENERHD 50 |
| MTI WIRELESS vs. SPORTING | MTI WIRELESS vs. BlueScope Steel Limited | MTI WIRELESS vs. ANTA SPORTS PRODUCT | MTI WIRELESS vs. CosmoSteel Holdings 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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