Correlation Between Celtic Plc and QYOU Media

Can any of the company-specific risk be diversified away by investing in both Celtic Plc and QYOU Media 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 Celtic Plc and QYOU Media into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Celtic plc and QYOU Media, you can compare the effects of market volatilities on Celtic Plc and QYOU Media 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 Celtic Plc with a short position of QYOU Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Celtic Plc and QYOU Media.

Diversification Opportunities for Celtic Plc and QYOU Media

0.51

Correlation Coefficient

Celtic Plc  QYOU Media

Very weak diversification

The 3 months correlation between Celtic and QYOU is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Celtic plc and QYOU Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QYOU Media and Celtic Plc 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 Celtic plc are associated (or correlated) with QYOU Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QYOU Media has no effect on the direction of Celtic Plc i.e., Celtic Plc and QYOU Media go up and down completely randomly.

Pair Corralation between Celtic Plc and QYOU Media

Assuming the 90 days horizon Celtic plc is expected to under-perform the QYOU Media. But the pink sheet apears to be less risky and, when comparing its historical volatility, Celtic plc is 5.58 times less risky than QYOU Media. The pink sheet trades about -0.05 of its potential returns per unit of risk. The QYOU Media is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  2.51  in QYOU Media on October 8, 2024 and sell it today you would earn a total of  0.15  from holding QYOU Media or generate 5.98% return on investment over 90 days.

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

Celtic plc  vs.  QYOU Media

Celtic plc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Celtic plc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Celtic Plc is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

QYOU Media

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in QYOU Media are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, QYOU Media reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Celtic Plc and QYOU Media

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

The idea behind Celtic plc and QYOU Media 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.