Correlation Between Portfolio and Quantex Fund

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

By analyzing existing cross correlation between Portfolio 21 Global and Quantex Fund Retail, you can compare the effects of market volatilities on Portfolio and Quantex Fund 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 Portfolio with a short position of Quantex Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Portfolio and Quantex Fund.

Diversification Opportunities for Portfolio and Quantex Fund

0.39

Correlation Coefficient

Portfolio  Quantex Fund

Weak diversification

The 3 months correlation between Portfolio and Quantex is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Portfolio 21 Global and Quantex Fund Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quantex Fund Retail and Portfolio 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 Portfolio 21 Global are associated (or correlated) with Quantex Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quantex Fund Retail has no effect on the direction of Portfolio i.e., Portfolio and Quantex Fund go up and down completely randomly.

Pair Corralation between Portfolio and Quantex Fund

Assuming the 90 days horizon Portfolio is expected to generate 1.9 times less return on investment than Quantex Fund. But when comparing it to its historical volatility, Portfolio 21 Global is 1.08 times less risky than Quantex Fund. It trades about 0.06 of its potential returns per unit of risk. Quantex Fund Retail is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  3,473  in Quantex Fund Retail on September 5, 2024 and sell it today you would earn a total of  757.00  from holding Quantex Fund Retail or generate 21.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	99.6%
Values	Daily Returns

Portfolio 21 Global  vs.  Quantex Fund Retail

Portfolio 21 Global

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Portfolio 21 Global are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Portfolio is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Quantex Fund Retail

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Quantex Fund Retail are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Quantex Fund may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Portfolio and Quantex Fund

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

The idea behind Portfolio 21 Global and Quantex Fund Retail 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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.