Correlation Between IQ Hedge and AGFiQ Market

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

By analyzing existing cross correlation between IQ Hedge Multi Strategy and AGFiQ Market Neutral, you can compare the effects of market volatilities on IQ Hedge and AGFiQ Market 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 IQ Hedge with a short position of AGFiQ Market. Check out your portfolio center. Please also check ongoing floating volatility patterns of IQ Hedge and AGFiQ Market.

Diversification Opportunities for IQ Hedge and AGFiQ Market

-0.89

Correlation Coefficient

IQ Hedge  AGFiQ Market

Pay attention - limited upside

The 3 months correlation between QAI and AGFiQ is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding IQ Hedge Multi Strategy and AGFiQ Market Neutral in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGFiQ Market Neutral and IQ Hedge 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 IQ Hedge Multi Strategy are associated (or correlated) with AGFiQ Market. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGFiQ Market Neutral has no effect on the direction of IQ Hedge i.e., IQ Hedge and AGFiQ Market go up and down completely randomly.

Pair Corralation between IQ Hedge and AGFiQ Market

Considering the 90-day investment horizon IQ Hedge Multi Strategy is expected to generate 0.32 times more return on investment than AGFiQ Market. However, IQ Hedge Multi Strategy is 3.14 times less risky than AGFiQ Market. It trades about 0.09 of its potential returns per unit of risk. AGFiQ Market Neutral is currently generating about 0.0 per unit of risk. If you would invest  2,776  in IQ Hedge Multi Strategy on September 29, 2024 and sell it today you would earn a total of  440.00  from holding IQ Hedge Multi Strategy or generate 15.85% return on investment over 90 days.

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

IQ Hedge Multi Strategy  vs.  AGFiQ Market Neutral

IQ Hedge Multi

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in IQ Hedge Multi Strategy are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, IQ Hedge is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

AGFiQ Market Neutral

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AGFiQ Market Neutral has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, AGFiQ Market is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with IQ Hedge and AGFiQ Market

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

The idea behind IQ Hedge Multi Strategy and AGFiQ Market Neutral 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 Global Correlations module to find global opportunities by holding instruments from different markets.