Correlation Between Nortec Minerals and Quisitive Technology

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

By analyzing existing cross correlation between Nortec Minerals Corp and Quisitive Technology Solutions, you can compare the effects of market volatilities on Nortec Minerals and Quisitive Technology 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 Nortec Minerals with a short position of Quisitive Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nortec Minerals and Quisitive Technology.

Diversification Opportunities for Nortec Minerals and Quisitive Technology

-0.44

Correlation Coefficient

Nortec Minerals  Quisitive Technology

Very good diversification

The 3 months correlation between Nortec and Quisitive is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Nortec Minerals Corp and Quisitive Technology Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quisitive Technology and Nortec Minerals 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 Nortec Minerals Corp are associated (or correlated) with Quisitive Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quisitive Technology has no effect on the direction of Nortec Minerals i.e., Nortec Minerals and Quisitive Technology go up and down completely randomly.

Pair Corralation between Nortec Minerals and Quisitive Technology

Assuming the 90 days horizon Nortec Minerals Corp is expected to under-perform the Quisitive Technology. In addition to that, Nortec Minerals is 1.67 times more volatile than Quisitive Technology Solutions. It trades about -0.01 of its total potential returns per unit of risk. Quisitive Technology Solutions is currently generating about 0.05 per unit of volatility. If you would invest  31.00  in Quisitive Technology Solutions on September 29, 2024 and sell it today you would earn a total of  4.00  from holding Quisitive Technology Solutions or generate 12.9% return on investment over 90 days.

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

Nortec Minerals Corp  vs.  Quisitive Technology Solutions

Nortec Minerals Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nortec Minerals Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Quisitive Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Quisitive Technology Solutions has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable forward indicators, Quisitive Technology is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Nortec Minerals and Quisitive Technology

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

The idea behind Nortec Minerals Corp and Quisitive Technology Solutions 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.