Correlation Between Picton Mahoney and Quadravest Preferred

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

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

Diversification Opportunities for Picton Mahoney and Quadravest Preferred

0.88

Correlation Coefficient

Picton Mahoney  Quadravest Preferred

Very poor diversification

The 3 months correlation between Picton and Quadravest is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Picton Mahoney Fortified and Quadravest Preferred Split in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quadravest Preferred and Picton Mahoney 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 Picton Mahoney Fortified are associated (or correlated) with Quadravest Preferred. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quadravest Preferred has no effect on the direction of Picton Mahoney i.e., Picton Mahoney and Quadravest Preferred go up and down completely randomly.

Pair Corralation between Picton Mahoney and Quadravest Preferred

Assuming the 90 days trading horizon Picton Mahoney is expected to generate 2.21 times less return on investment than Quadravest Preferred. But when comparing it to its historical volatility, Picton Mahoney Fortified is 1.46 times less risky than Quadravest Preferred. It trades about 0.2 of its potential returns per unit of risk. Quadravest Preferred Split is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest  1,022  in Quadravest Preferred Split on April 22, 2025 and sell it today you would earn a total of  46.00  from holding Quadravest Preferred Split or generate 4.5% return on investment over 90 days.

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

Picton Mahoney Fortified  vs.  Quadravest Preferred Split

Picton Mahoney Fortified

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Picton Mahoney Fortified are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Picton Mahoney is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Quadravest Preferred

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Quadravest Preferred Split are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Quadravest Preferred is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Picton Mahoney and Quadravest Preferred

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

The idea behind Picton Mahoney Fortified and Quadravest Preferred Split 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.