Correlation Between Q2M Managementberatu and Sporttotal

Can any of the company-specific risk be diversified away by investing in both Q2M Managementberatu and Sporttotal 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 Q2M Managementberatu and Sporttotal into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Q2M Managementberatung AG and Sporttotal AG, you can compare the effects of market volatilities on Q2M Managementberatu and Sporttotal 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 Q2M Managementberatu with a short position of Sporttotal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Q2M Managementberatu and Sporttotal.

Diversification Opportunities for Q2M Managementberatu and Sporttotal

0.7

Correlation Coefficient

Q2M Managementberatu  Sporttotal

Poor diversification

The 3 months correlation between Q2M and Sporttotal is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Q2M Managementberatung AG and Sporttotal AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sporttotal AG and Q2M Managementberatu 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 Q2M Managementberatung AG are associated (or correlated) with Sporttotal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sporttotal AG has no effect on the direction of Q2M Managementberatu i.e., Q2M Managementberatu and Sporttotal go up and down completely randomly.

Pair Corralation between Q2M Managementberatu and Sporttotal

Assuming the 90 days trading horizon Q2M Managementberatung AG is expected to generate 0.08 times more return on investment than Sporttotal. However, Q2M Managementberatung AG is 12.99 times less risky than Sporttotal. It trades about -0.25 of its potential returns per unit of risk. Sporttotal AG is currently generating about -0.05 per unit of risk. If you would invest  100.00  in Q2M Managementberatung AG on November 29, 2024 and sell it today you would lose (10.00) from holding Q2M Managementberatung AG or give up 10.0% of portfolio value over 90 days.

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

Q2M Managementberatung AG  vs.  Sporttotal AG

Q2M Managementberatung

Risk-Adjusted Performance

Very Weak

Over the last 90 days Q2M Managementberatung AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's forward indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Sporttotal AG

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sporttotal AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in March 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Q2M Managementberatu and Sporttotal

The main advantage of trading using opposite Q2M Managementberatu and Sporttotal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Q2M Managementberatu position performs unexpectedly, Sporttotal 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 Sporttotal will offset losses from the drop in Sporttotal's long position.

The idea behind Q2M Managementberatung AG and Sporttotal AG 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.