Correlation Between Queens Road and ISign Media

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

By analyzing existing cross correlation between Queens Road Capital and iSign Media Solutions, you can compare the effects of market volatilities on Queens Road and ISign Media 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 Queens Road with a short position of ISign Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Queens Road and ISign Media.

Diversification Opportunities for Queens Road and ISign Media

0.15

Correlation Coefficient

Queens Road  ISign Media

Average diversification

The 3 months correlation between Queens and ISign is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Queens Road Capital and iSign Media Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iSign Media Solutions and Queens Road 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 Queens Road Capital are associated (or correlated) with ISign Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iSign Media Solutions has no effect on the direction of Queens Road i.e., Queens Road and ISign Media go up and down completely randomly.

Pair Corralation between Queens Road and ISign Media

Assuming the 90 days trading horizon Queens Road Capital is expected to generate 5.4 times more return on investment than ISign Media. However, Queens Road is 5.4 times more volatile than iSign Media Solutions. It trades about 0.04 of its potential returns per unit of risk. iSign Media Solutions is currently generating about -0.04 per unit of risk. If you would invest  710.00  in Queens Road Capital on October 26, 2024 and sell it today you would earn a total of  10.00  from holding Queens Road Capital or generate 1.41% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	70.0%
Values	Daily Returns

Queens Road Capital  vs.  iSign Media Solutions

Queens Road Capital

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Queens Road Capital has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental indicators, Queens Road is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

iSign Media Solutions

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Queens Road and ISign Media

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

The idea behind Queens Road Capital and iSign Media 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.