Correlation Between Carlyle and QT Imaging

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

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

Diversification Opportunities for Carlyle and QT Imaging

-0.45

Correlation Coefficient

Carlyle  QT Imaging

Very good diversification

The 3 months correlation between Carlyle and QTI is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Carlyle Group 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 Carlyle 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 Carlyle Group 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 Carlyle i.e., Carlyle and QT Imaging go up and down completely randomly.

Pair Corralation between Carlyle and QT Imaging

Allowing for the 90-day total investment horizon Carlyle Group is expected to generate 0.31 times more return on investment than QT Imaging. However, Carlyle Group is 3.22 times less risky than QT Imaging. It trades about 0.19 of its potential returns per unit of risk. QT Imaging Holdings is currently generating about -0.01 per unit of risk. If you would invest  4,080  in Carlyle Group on September 15, 2024 and sell it today you would earn a total of  1,184  from holding Carlyle Group or generate 29.02% return on investment over 90 days.

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

Carlyle Group  vs.  QT Imaging Holdings

Carlyle Group

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Carlyle Group are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite nearly abnormal technical and fundamental indicators, Carlyle reported solid returns over the last few months and may actually be approaching a breakup point.

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 fairly strong basic indicators, QT Imaging is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Carlyle and QT Imaging

The main advantage of trading using opposite Carlyle and QT Imaging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carlyle 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 Carlyle Group 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.

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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.