Correlation Between QURATE RETAIL and AIR LIQUIDE

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

By analyzing existing cross correlation between QURATE RETAIL INC and AIR LIQUIDE ADR, you can compare the effects of market volatilities on QURATE RETAIL and AIR LIQUIDE 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 QURATE RETAIL with a short position of AIR LIQUIDE. Check out your portfolio center. Please also check ongoing floating volatility patterns of QURATE RETAIL and AIR LIQUIDE.

Diversification Opportunities for QURATE RETAIL and AIR LIQUIDE

0.76

Correlation Coefficient

QURATE RETAIL  AIR LIQUIDE

Poor diversification

The 3 months correlation between QURATE and AIR is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding QURATE RETAIL INC and AIR LIQUIDE ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AIR LIQUIDE ADR and QURATE RETAIL 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 QURATE RETAIL INC are associated (or correlated) with AIR LIQUIDE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AIR LIQUIDE ADR has no effect on the direction of QURATE RETAIL i.e., QURATE RETAIL and AIR LIQUIDE go up and down completely randomly.

Pair Corralation between QURATE RETAIL and AIR LIQUIDE

Assuming the 90 days trading horizon QURATE RETAIL is expected to generate 3.43 times less return on investment than AIR LIQUIDE. In addition to that, QURATE RETAIL is 3.18 times more volatile than AIR LIQUIDE ADR. It trades about 0.0 of its total potential returns per unit of risk. AIR LIQUIDE ADR is currently generating about 0.03 per unit of volatility. If you would invest  2,466  in AIR LIQUIDE ADR on October 12, 2024 and sell it today you would earn a total of  634.00  from holding AIR LIQUIDE ADR or generate 25.71% return on investment over 90 days.

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

QURATE RETAIL INC  vs.  AIR LIQUIDE ADR

QURATE RETAIL INC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days QURATE RETAIL INC 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 basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

AIR LIQUIDE ADR

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AIR LIQUIDE ADR has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's essential indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with QURATE RETAIL and AIR LIQUIDE

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

The idea behind QURATE RETAIL INC and AIR LIQUIDE ADR 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.