Correlation Between BriQ Properties and Quest Holdings

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

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

Diversification Opportunities for BriQ Properties and Quest Holdings

0.65

Correlation Coefficient

BriQ Properties  Quest Holdings

Poor diversification

The 3 months correlation between BriQ and Quest is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding BriQ Properties Real and Quest Holdings SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quest Holdings SA and BriQ Properties 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 BriQ Properties Real are associated (or correlated) with Quest Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quest Holdings SA has no effect on the direction of BriQ Properties i.e., BriQ Properties and Quest Holdings go up and down completely randomly.

Pair Corralation between BriQ Properties and Quest Holdings

Assuming the 90 days trading horizon BriQ Properties is expected to generate 1.48 times less return on investment than Quest Holdings. But when comparing it to its historical volatility, BriQ Properties Real is 1.78 times less risky than Quest Holdings. It trades about 0.14 of its potential returns per unit of risk. Quest Holdings SA is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  525.00  in Quest Holdings SA on September 15, 2024 and sell it today you would earn a total of  54.00  from holding Quest Holdings SA or generate 10.29% return on investment over 90 days.

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

BriQ Properties Real  vs.  Quest Holdings SA

BriQ Properties Real

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in BriQ Properties Real are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, BriQ Properties may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Quest Holdings SA

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Quest Holdings SA are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Quest Holdings may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with BriQ Properties and Quest Holdings

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

The idea behind BriQ Properties Real and Quest Holdings 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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.