Correlation Between QURATE RETAIL and Pembina Pipeline

Can any of the company-specific risk be diversified away by investing in both QURATE RETAIL and Pembina Pipeline 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 Pembina Pipeline 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 Pembina Pipeline Corp, you can compare the effects of market volatilities on QURATE RETAIL and Pembina Pipeline 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 Pembina Pipeline. Check out your portfolio center. Please also check ongoing floating volatility patterns of QURATE RETAIL and Pembina Pipeline.

Diversification Opportunities for QURATE RETAIL and Pembina Pipeline

0.1

Correlation Coefficient

QURATE RETAIL  Pembina Pipeline

Average diversification

The 3 months correlation between QURATE and Pembina is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding QURATE RETAIL INC and Pembina Pipeline Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pembina Pipeline Corp 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 Pembina Pipeline. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pembina Pipeline Corp has no effect on the direction of QURATE RETAIL i.e., QURATE RETAIL and Pembina Pipeline go up and down completely randomly.

Pair Corralation between QURATE RETAIL and Pembina Pipeline

Assuming the 90 days trading horizon QURATE RETAIL INC is expected to generate 8.57 times more return on investment than Pembina Pipeline. However, QURATE RETAIL is 8.57 times more volatile than Pembina Pipeline Corp. It trades about 0.02 of its potential returns per unit of risk. Pembina Pipeline Corp is currently generating about -0.46 per unit of risk. If you would invest  296.00  in QURATE RETAIL INC on October 4, 2024 and sell it today you would lose (6.00) from holding QURATE RETAIL INC or give up 2.03% of portfolio value over 90 days.

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

QURATE RETAIL INC  vs.  Pembina Pipeline Corp

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 fragile 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.

Pembina Pipeline Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pembina Pipeline Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic 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 Pembina Pipeline

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

The idea behind QURATE RETAIL INC and Pembina Pipeline Corp 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.