Correlation Between Iteris and Quarterhill

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

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

Diversification Opportunities for Iteris and Quarterhill

0.51

Correlation Coefficient

Iteris  Quarterhill

Very weak diversification

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

Pair Corralation between Iteris and Quarterhill

If you would invest  705.00  in Iteris Inc on September 3, 2024 and sell it today you would earn a total of  25,944  from holding Iteris Inc or generate 3680.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	2.04%
Values	Daily Returns

Iteris Inc  vs.  Quarterhill

Iteris Inc

Risk-Adjusted Performance

0 of 100

Good

Over the last 90 days Iteris Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly unsteady basic indicators, Iteris demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Quarterhill

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Iteris and Quarterhill

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

The idea behind Iteris Inc and Quarterhill 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.

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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.