Correlation Between Manitou BF and SQLI SA

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

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

Diversification Opportunities for Manitou BF and SQLI SA

-0.07

Correlation Coefficient

Manitou BF  SQLI SA

Good diversification

The 3 months correlation between Manitou and SQLI is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Manitou BF SA and SQLI SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SQLI SA and Manitou BF 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 Manitou BF SA are associated (or correlated) with SQLI SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SQLI SA has no effect on the direction of Manitou BF i.e., Manitou BF and SQLI SA go up and down completely randomly.

Pair Corralation between Manitou BF and SQLI SA

If you would invest  1,688  in Manitou BF SA on October 15, 2024 and sell it today you would earn a total of  104.00  from holding Manitou BF SA or generate 6.16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	5.56%
Values	Daily Returns

Manitou BF SA  vs.  SQLI SA

Manitou BF SA

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Manitou BF SA are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Manitou BF may actually be approaching a critical reversion point that can send shares even higher in February 2025.

SQLI SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SQLI SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong forward indicators, SQLI SA is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Manitou BF and SQLI SA

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

The idea behind Manitou BF SA and SQLI SA 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.