Correlation Between Stagwell and QuinStreet

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

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

Diversification Opportunities for Stagwell and QuinStreet

0.57

Correlation Coefficient

Stagwell  QuinStreet

Very weak diversification

The 3 months correlation between Stagwell and QuinStreet is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Stagwell and QuinStreet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QuinStreet and Stagwell 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 Stagwell are associated (or correlated) with QuinStreet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QuinStreet has no effect on the direction of Stagwell i.e., Stagwell and QuinStreet go up and down completely randomly.

Pair Corralation between Stagwell and QuinStreet

Given the investment horizon of 90 days Stagwell is expected to generate 0.9 times more return on investment than QuinStreet. However, Stagwell is 1.11 times less risky than QuinStreet. It trades about -0.06 of its potential returns per unit of risk. QuinStreet is currently generating about -0.15 per unit of risk. If you would invest  660.00  in Stagwell on December 30, 2024 and sell it today you would lose (67.00) from holding Stagwell or give up 10.15% of portfolio value over 90 days.

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

Stagwell  vs.  QuinStreet

Stagwell

Risk-Adjusted Performance

Very Weak

Over the last 90 days Stagwell has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's technical and fundamental indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

QuinStreet

Risk-Adjusted Performance

Very Weak

Over the last 90 days QuinStreet 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 April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Stagwell and QuinStreet

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

The idea behind Stagwell and QuinStreet 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.