Correlation Between Winpak and Quisitive Technology

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

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

Diversification Opportunities for Winpak and Quisitive Technology

-0.22

Correlation Coefficient

Winpak  Quisitive Technology

Very good diversification

The 3 months correlation between Winpak and Quisitive is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Winpak and Quisitive Technology Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quisitive Technology and Winpak 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 Winpak are associated (or correlated) with Quisitive Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quisitive Technology has no effect on the direction of Winpak i.e., Winpak and Quisitive Technology go up and down completely randomly.

Pair Corralation between Winpak and Quisitive Technology

Assuming the 90 days trading horizon Winpak is expected to generate 0.33 times more return on investment than Quisitive Technology. However, Winpak is 3.06 times less risky than Quisitive Technology. It trades about 0.03 of its potential returns per unit of risk. Quisitive Technology Solutions is currently generating about 0.0 per unit of risk. If you would invest  4,144  in Winpak on September 4, 2024 and sell it today you would earn a total of  735.00  from holding Winpak or generate 17.74% return on investment over 90 days.

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

Winpak  vs.  Quisitive Technology Solutions

Winpak

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Winpak are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal forward-looking signals, Winpak may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Quisitive Technology

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Quisitive Technology Solutions are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable forward indicators, Quisitive Technology is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Winpak and Quisitive Technology

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

The idea behind Winpak and Quisitive Technology Solutions 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.