Correlation Between BBB Foods and QT Imaging

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

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

Diversification Opportunities for BBB Foods and QT Imaging

0.61

Correlation Coefficient

BBB Foods  QT Imaging

Poor diversification

The 3 months correlation between BBB and QTI is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding BBB Foods and QT Imaging Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QT Imaging Holdings and BBB Foods 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 BBB Foods are associated (or correlated) with QT Imaging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QT Imaging Holdings has no effect on the direction of BBB Foods i.e., BBB Foods and QT Imaging go up and down completely randomly.

Pair Corralation between BBB Foods and QT Imaging

Given the investment horizon of 90 days BBB Foods is expected to under-perform the QT Imaging. But the stock apears to be less risky and, when comparing its historical volatility, BBB Foods is 4.6 times less risky than QT Imaging. The stock trades about -0.01 of its potential returns per unit of risk. The QT Imaging Holdings is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  38.00  in QT Imaging Holdings on October 23, 2024 and sell it today you would earn a total of  9.00  from holding QT Imaging Holdings or generate 23.68% return on investment over 90 days.

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

BBB Foods  vs.  QT Imaging Holdings

BBB Foods

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BBB Foods has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's fundamental drivers remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

QT Imaging Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days QT Imaging Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with BBB Foods and QT Imaging

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

The idea behind BBB Foods and QT Imaging Holdings 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.