Correlation Between BlockQuarry Corp and Lion Group

Can any of the company-specific risk be diversified away by investing in both BlockQuarry Corp and Lion Group 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 BlockQuarry Corp and Lion Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between BlockQuarry Corp and Lion Group Holding, you can compare the effects of market volatilities on BlockQuarry Corp and Lion Group 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 BlockQuarry Corp with a short position of Lion Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of BlockQuarry Corp and Lion Group.

Diversification Opportunities for BlockQuarry Corp and Lion Group

0.74

Correlation Coefficient

BlockQuarry Corp  Lion Group

Poor diversification

The 3 months correlation between BlockQuarry and Lion is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding BlockQuarry Corp and Lion Group Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion Group Holding and BlockQuarry Corp 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 BlockQuarry Corp are associated (or correlated) with Lion Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion Group Holding has no effect on the direction of BlockQuarry Corp i.e., BlockQuarry Corp and Lion Group go up and down completely randomly.

Pair Corralation between BlockQuarry Corp and Lion Group

Given the investment horizon of 90 days BlockQuarry Corp is expected to generate 1.99 times more return on investment than Lion Group. However, BlockQuarry Corp is 1.99 times more volatile than Lion Group Holding. It trades about -0.05 of its potential returns per unit of risk. Lion Group Holding is currently generating about -0.15 per unit of risk. If you would invest  4.20  in BlockQuarry Corp on December 29, 2024 and sell it today you would lose (2.90) from holding BlockQuarry Corp or give up 69.05% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

BlockQuarry Corp  vs.  Lion Group Holding

BlockQuarry Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days BlockQuarry Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Lion Group Holding

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lion Group Holding has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with BlockQuarry Corp and Lion Group

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

The idea behind BlockQuarry Corp and Lion Group Holding 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.