Correlation Between MQGAU and Ipsos SA

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

By analyzing existing cross correlation between MQGAU 5376057 23 SEP 27 and Ipsos SA, you can compare the effects of market volatilities on MQGAU and Ipsos 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 MQGAU with a short position of Ipsos SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of MQGAU and Ipsos SA.

Diversification Opportunities for MQGAU and Ipsos SA

-0.71

Correlation Coefficient

MQGAU  Ipsos SA

Pay attention - limited upside

The 3 months correlation between MQGAU and Ipsos is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding MQGAU 5376057 23 SEP 27 and Ipsos SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ipsos SA and MQGAU 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 MQGAU 5376057 23 SEP 27 are associated (or correlated) with Ipsos SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ipsos SA has no effect on the direction of MQGAU i.e., MQGAU and Ipsos SA go up and down completely randomly.

Pair Corralation between MQGAU and Ipsos SA

Assuming the 90 days trading horizon MQGAU 5376057 23 SEP 27 is expected to generate 0.15 times more return on investment than Ipsos SA. However, MQGAU 5376057 23 SEP 27 is 6.51 times less risky than Ipsos SA. It trades about 0.13 of its potential returns per unit of risk. Ipsos SA is currently generating about -0.11 per unit of risk. If you would invest  10,022  in MQGAU 5376057 23 SEP 27 on September 13, 2024 and sell it today you would earn a total of  24.00  from holding MQGAU 5376057 23 SEP 27 or generate 0.24% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	31.25%
Values	Daily Returns

MQGAU 5376057 23 SEP 27  vs.  Ipsos SA

MQGAU 5376057 23

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in MQGAU 5376057 23 SEP 27 are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, MQGAU is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Ipsos SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ipsos SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Ipsos SA is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with MQGAU and Ipsos SA

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

The idea behind MQGAU 5376057 23 SEP 27 and Ipsos 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.