Correlation Between Bpost NV and QRF SCA

Can any of the company-specific risk be diversified away by investing in both Bpost NV and QRF SCA 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 Bpost NV and QRF SCA into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Bpost NV and QRF SCA, you can compare the effects of market volatilities on Bpost NV and QRF SCA 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 Bpost NV with a short position of QRF SCA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bpost NV and QRF SCA.

Diversification Opportunities for Bpost NV and QRF SCA

-0.13

Correlation Coefficient

Bpost NV  QRF SCA

Good diversification

The 3 months correlation between Bpost and QRF is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Bpost NV and QRF SCA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QRF SCA and Bpost NV 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 Bpost NV are associated (or correlated) with QRF SCA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QRF SCA has no effect on the direction of Bpost NV i.e., Bpost NV and QRF SCA go up and down completely randomly.

Pair Corralation between Bpost NV and QRF SCA

Assuming the 90 days trading horizon Bpost NV is expected to under-perform the QRF SCA. In addition to that, Bpost NV is 2.94 times more volatile than QRF SCA. It trades about -0.07 of its total potential returns per unit of risk. QRF SCA is currently generating about 0.02 per unit of volatility. If you would invest  1,015  in QRF SCA on December 21, 2024 and sell it today you would earn a total of  10.00  from holding QRF SCA or generate 0.99% return on investment over 90 days.

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

Bpost NV  vs.  QRF SCA

Bpost NV

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bpost NV 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 fundamental drivers remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

QRF SCA

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in QRF SCA are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable technical and fundamental indicators, QRF SCA is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Bpost NV and QRF SCA

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

The idea behind Bpost NV and QRF SCA 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.