Correlation Between N B and Quintegra Solutions

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

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

Diversification Opportunities for N B and Quintegra Solutions

0.84

Correlation Coefficient

N B  Quintegra Solutions

Very poor diversification

The 3 months correlation between NBIFIN and Quintegra is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding N B I and Quintegra Solutions Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quintegra Solutions and N B 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 N B I are associated (or correlated) with Quintegra Solutions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quintegra Solutions has no effect on the direction of N B i.e., N B and Quintegra Solutions go up and down completely randomly.

Pair Corralation between N B and Quintegra Solutions

Assuming the 90 days trading horizon N B I is expected to generate 1.59 times more return on investment than Quintegra Solutions. However, N B is 1.59 times more volatile than Quintegra Solutions Limited. It trades about 0.23 of its potential returns per unit of risk. Quintegra Solutions Limited is currently generating about 0.25 per unit of risk. If you would invest  233,100  in N B I on September 12, 2024 and sell it today you would earn a total of  113,215  from holding N B I or generate 48.57% return on investment over 90 days.

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

N B I  vs.  Quintegra Solutions Limited

N B I

Risk-Adjusted Performance

18 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in N B I are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak technical and fundamental indicators, N B sustained solid returns over the last few months and may actually be approaching a breakup point.

Quintegra Solutions

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Quintegra Solutions Limited are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain technical and fundamental indicators, Quintegra Solutions reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with N B and Quintegra Solutions

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

The idea behind N B I and Quintegra Solutions Limited 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.