Correlation Between UQC and Qtum

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

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

Diversification Opportunities for UQC and Qtum

-0.03

Correlation Coefficient

UQC  Qtum

Good diversification

The 3 months correlation between UQC and Qtum is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding UQC and Qtum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qtum and UQC 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 UQC are associated (or correlated) with Qtum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qtum has no effect on the direction of UQC i.e., UQC and Qtum go up and down completely randomly.

Pair Corralation between UQC and Qtum

Assuming the 90 days trading horizon UQC is expected to generate 6.47 times more return on investment than Qtum. However, UQC is 6.47 times more volatile than Qtum. It trades about 0.07 of its potential returns per unit of risk. Qtum is currently generating about 0.08 per unit of risk. If you would invest  383.00  in UQC on January 24, 2024 and sell it today you would earn a total of  237.00  from holding UQC or generate 61.88% return on investment over 90 days.

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

UQC  vs.  Qtum

UQC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days UQC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Crypto's fundamental indicators remain rather sound which may send shares a bit higher in May 2024. The latest tumult may also be a sign of longer-term up-swing for UQC shareholders.

Qtum

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Qtum are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Qtum exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with UQC and Qtum

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

The idea behind UQC and Qtum 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.