Correlation Between Qsam Biosciences and Living Cell

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

By analyzing existing cross correlation between Qsam Biosciences and Living Cell Technologies, you can compare the effects of market volatilities on Qsam Biosciences and Living Cell 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 Qsam Biosciences with a short position of Living Cell. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qsam Biosciences and Living Cell.

Diversification Opportunities for Qsam Biosciences and Living Cell

0.61

Correlation Coefficient

Qsam Biosciences  Living Cell

Poor diversification

The 3 months correlation between Qsam and Living is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Qsam Biosciences and Living Cell Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Living Cell Technologies and Qsam Biosciences 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 Qsam Biosciences are associated (or correlated) with Living Cell. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Living Cell Technologies has no effect on the direction of Qsam Biosciences i.e., Qsam Biosciences and Living Cell go up and down completely randomly.

Pair Corralation between Qsam Biosciences and Living Cell

If you would invest  0.43  in Living Cell Technologies on September 14, 2024 and sell it today you would earn a total of  0.08  from holding Living Cell Technologies or generate 18.6% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	4.55%
Values	Daily Returns

Qsam Biosciences  vs.  Living Cell Technologies

Qsam Biosciences

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Qsam Biosciences has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Qsam Biosciences is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Living Cell Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Living Cell Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's essential indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Qsam Biosciences and Living Cell

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

The idea behind Qsam Biosciences and Living Cell Technologies 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.