Correlation Between Quad Graphics and Twitter

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Can any of the company-specific risk be diversified away by investing in both Quad Graphics and Twitter 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 Quad Graphics and Twitter into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Quad Graphics and Twitter, you can compare the effects of market volatilities on Quad Graphics and Twitter 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 Quad Graphics with a short position of Twitter. Check out your portfolio center. Please also check ongoing floating volatility patterns of Quad Graphics and Twitter.

Diversification Opportunities for Quad Graphics and Twitter

-0.41
  Correlation Coefficient

Very good diversification

The 3 months correlation between Quad and Twitter is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Quad Graphics and Twitter in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Twitter and Quad Graphics 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 Quad Graphics are associated (or correlated) with Twitter. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Twitter has no effect on the direction of Quad Graphics i.e., Quad Graphics and Twitter go up and down completely randomly.

Pair Corralation between Quad Graphics and Twitter

If you would invest  5,370  in Twitter on December 29, 2023 and sell it today you would earn a total of  0.00  from holding Twitter or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy4.55%
ValuesDaily Returns

Quad Graphics  vs.  Twitter

 Performance 
       Timeline  
Quad Graphics 

Risk-Adjusted Performance

1 of 100

 
Low
 
High
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Quad Graphics are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Quad Graphics is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.
Twitter 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days Twitter has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Twitter is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Quad Graphics and Twitter Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Quad Graphics and Twitter

The main advantage of trading using opposite Quad Graphics and Twitter positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Quad Graphics position performs unexpectedly, Twitter 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 Twitter will offset losses from the drop in Twitter's long position.
The idea behind Quad Graphics and Twitter 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.

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