Correlation Between QBE Insurance and BPCEGP

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

By analyzing existing cross correlation between QBE Insurance Group and BPCEGP 5748 19 JUL 33, you can compare the effects of market volatilities on QBE Insurance and BPCEGP 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 QBE Insurance with a short position of BPCEGP. Check out your portfolio center. Please also check ongoing floating volatility patterns of QBE Insurance and BPCEGP.

Diversification Opportunities for QBE Insurance and BPCEGP

0.26

Correlation Coefficient

QBE Insurance  BPCEGP

Modest diversification

The 3 months correlation between QBE and BPCEGP is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding QBE Insurance Group and BPCEGP 5748 19 JUL 33 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BPCEGP 5748 19 and QBE Insurance 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 QBE Insurance Group are associated (or correlated) with BPCEGP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BPCEGP 5748 19 has no effect on the direction of QBE Insurance i.e., QBE Insurance and BPCEGP go up and down completely randomly.

Pair Corralation between QBE Insurance and BPCEGP

Assuming the 90 days horizon QBE Insurance Group is expected to generate 1.73 times more return on investment than BPCEGP. However, QBE Insurance is 1.73 times more volatile than BPCEGP 5748 19 JUL 33. It trades about 0.08 of its potential returns per unit of risk. BPCEGP 5748 19 JUL 33 is currently generating about -0.21 per unit of risk. If you would invest  1,048  in QBE Insurance Group on September 2, 2024 and sell it today you would earn a total of  117.00  from holding QBE Insurance Group or generate 11.16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	20.31%
Values	Daily Returns

QBE Insurance Group  vs.  BPCEGP 5748 19 JUL 33

QBE Insurance Group

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in QBE Insurance Group are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak forward indicators, QBE Insurance may actually be approaching a critical reversion point that can send shares even higher in January 2025.

BPCEGP 5748 19

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BPCEGP 5748 19 JUL 33 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for BPCEGP 5748 19 JUL 33 investors.

Pair Trading with QBE Insurance and BPCEGP

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

The idea behind QBE Insurance Group and BPCEGP 5748 19 JUL 33 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.