Correlation Between QNB Corp and BlackRock MIT

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

By analyzing existing cross correlation between QNB Corp and BlackRock MIT II, you can compare the effects of market volatilities on QNB Corp and BlackRock MIT 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 QNB Corp with a short position of BlackRock MIT. Check out your portfolio center. Please also check ongoing floating volatility patterns of QNB Corp and BlackRock MIT.

Diversification Opportunities for QNB Corp and BlackRock MIT

0.43

Correlation Coefficient

QNB Corp  BlackRock MIT

Very weak diversification

The 3 months correlation between QNB and BlackRock is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding QNB Corp and BlackRock MIT II in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BlackRock MIT II and QNB Corp 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 QNB Corp are associated (or correlated) with BlackRock MIT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BlackRock MIT II has no effect on the direction of QNB Corp i.e., QNB Corp and BlackRock MIT go up and down completely randomly.

Pair Corralation between QNB Corp and BlackRock MIT

Given the investment horizon of 90 days QNB Corp is expected to generate 1.4 times more return on investment than BlackRock MIT. However, QNB Corp is 1.4 times more volatile than BlackRock MIT II. It trades about 0.14 of its potential returns per unit of risk. BlackRock MIT II is currently generating about 0.01 per unit of risk. If you would invest  3,364  in QNB Corp on December 19, 2024 and sell it today you would earn a total of  211.00  from holding QNB Corp or generate 6.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.33%
Values	Daily Returns

QNB Corp  vs.  BlackRock MIT II

QNB Corp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in QNB Corp are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating fundamental drivers, QNB Corp may actually be approaching a critical reversion point that can send shares even higher in April 2025.

BlackRock MIT II

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in BlackRock MIT II are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound essential indicators, BlackRock MIT is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with QNB Corp and BlackRock MIT

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

The idea behind QNB Corp and BlackRock MIT II 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.