Correlation Between Quisitive Technology and Globant SA

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

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

Diversification Opportunities for Quisitive Technology and Globant SA

-0.19

Correlation Coefficient

Quisitive Technology  Globant SA

Good diversification

The 3 months correlation between Quisitive and Globant is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Quisitive Technology Solutions and Globant SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Globant SA and Quisitive Technology 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 Quisitive Technology Solutions are associated (or correlated) with Globant SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Globant SA has no effect on the direction of Quisitive Technology i.e., Quisitive Technology and Globant SA go up and down completely randomly.

Pair Corralation between Quisitive Technology and Globant SA

Assuming the 90 days horizon Quisitive Technology Solutions is expected to under-perform the Globant SA. In addition to that, Quisitive Technology is 1.27 times more volatile than Globant SA. It trades about -0.02 of its total potential returns per unit of risk. Globant SA is currently generating about 0.07 per unit of volatility. If you would invest  19,708  in Globant SA on September 15, 2024 and sell it today you would earn a total of  1,970  from holding Globant SA or generate 10.0% return on investment over 90 days.

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

Quisitive Technology Solutions  vs.  Globant SA

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. Despite nearly stable basic indicators, Quisitive Technology is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Globant SA

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Globant SA are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating basic indicators, Globant SA may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Quisitive Technology and Globant SA

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

The idea behind Quisitive Technology Solutions and Globant SA 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.