Correlation Between Remitly Global and Borqs Technologies

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

By analyzing existing cross correlation between Remitly Global and Borqs Technologies, you can compare the effects of market volatilities on Remitly Global and Borqs Technologies 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 Remitly Global with a short position of Borqs Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Remitly Global and Borqs Technologies.

Diversification Opportunities for Remitly Global and Borqs Technologies

-0.79

Correlation Coefficient

Remitly Global  Borqs Technologies

Pay attention - limited upside

The 3 months correlation between Remitly and Borqs is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Remitly Global and Borqs Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Borqs Technologies and Remitly Global 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 Remitly Global are associated (or correlated) with Borqs Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Borqs Technologies has no effect on the direction of Remitly Global i.e., Remitly Global and Borqs Technologies go up and down completely randomly.

Pair Corralation between Remitly Global and Borqs Technologies

Given the investment horizon of 90 days Remitly Global is expected to generate 0.56 times more return on investment than Borqs Technologies. However, Remitly Global is 1.78 times less risky than Borqs Technologies. It trades about 0.05 of its potential returns per unit of risk. Borqs Technologies is currently generating about -0.06 per unit of risk. If you would invest  1,268  in Remitly Global on September 26, 2024 and sell it today you would earn a total of  996.00  from holding Remitly Global or generate 78.55% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	24.63%
Values	Daily Returns

Remitly Global  vs.  Borqs Technologies

Remitly Global

Risk-Adjusted Performance

22 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Remitly Global are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal essential indicators, Remitly Global showed solid returns over the last few months and may actually be approaching a breakup point.

Borqs Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Borqs Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Borqs Technologies is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Remitly Global and Borqs Technologies

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

The idea behind Remitly Global and Borqs Technologies 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.