Correlation Between Swift Haulage and QL Resources

Can any of the company-specific risk be diversified away by investing in both Swift Haulage and QL Resources 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 Swift Haulage and QL Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Swift Haulage Bhd and QL Resources Bhd, you can compare the effects of market volatilities on Swift Haulage and QL Resources 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 Swift Haulage with a short position of QL Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swift Haulage and QL Resources.

Diversification Opportunities for Swift Haulage and QL Resources

-0.44

Correlation Coefficient

Swift Haulage  QL Resources

Very good diversification

The 3 months correlation between Swift and 7084 is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Swift Haulage Bhd and QL Resources Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QL Resources Bhd and Swift Haulage 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 Swift Haulage Bhd are associated (or correlated) with QL Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QL Resources Bhd has no effect on the direction of Swift Haulage i.e., Swift Haulage and QL Resources go up and down completely randomly.

Pair Corralation between Swift Haulage and QL Resources

Assuming the 90 days trading horizon Swift Haulage Bhd is expected to under-perform the QL Resources. In addition to that, Swift Haulage is 2.57 times more volatile than QL Resources Bhd. It trades about -0.07 of its total potential returns per unit of risk. QL Resources Bhd is currently generating about 0.09 per unit of volatility. If you would invest  481.00  in QL Resources Bhd on September 5, 2024 and sell it today you would earn a total of  8.00  from holding QL Resources Bhd or generate 1.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.65%
Values	Daily Returns

Swift Haulage Bhd  vs.  QL Resources Bhd

Swift Haulage Bhd

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Swift Haulage Bhd has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Swift Haulage is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

QL Resources Bhd

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in QL Resources Bhd are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, QL Resources may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Swift Haulage and QL Resources

The main advantage of trading using opposite Swift Haulage and QL Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swift Haulage position performs unexpectedly, QL Resources 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 QL Resources will offset losses from the drop in QL Resources' long position.

The idea behind Swift Haulage Bhd and QL Resources Bhd pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.