Correlation Between QBE Insurance and ECHO INVESTMENT
Can any of the company-specific risk be diversified away by investing in both QBE Insurance and ECHO INVESTMENT 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 QBE Insurance and ECHO INVESTMENT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between QBE Insurance Group and ECHO INVESTMENT ZY, you can compare the effects of market volatilities on QBE Insurance and ECHO INVESTMENT 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 QBE Insurance with a short position of ECHO INVESTMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of QBE Insurance and ECHO INVESTMENT.
Diversification Opportunities for QBE Insurance and ECHO INVESTMENT
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between QBE and ECHO is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding QBE Insurance Group and ECHO INVESTMENT ZY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ECHO INVESTMENT ZY and QBE Insurance 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 QBE Insurance Group are associated (or correlated) with ECHO INVESTMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ECHO INVESTMENT ZY has no effect on the direction of QBE Insurance i.e., QBE Insurance and ECHO INVESTMENT go up and down completely randomly.
Pair Corralation between QBE Insurance and ECHO INVESTMENT
Assuming the 90 days horizon QBE Insurance is expected to generate 4.07 times less return on investment than ECHO INVESTMENT. But when comparing it to its historical volatility, QBE Insurance Group is 1.51 times less risky than ECHO INVESTMENT. It trades about 0.04 of its potential returns per unit of risk. ECHO INVESTMENT ZY is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 109.00 in ECHO INVESTMENT ZY on April 25, 2025 and sell it today you would earn a total of 12.00 from holding ECHO INVESTMENT ZY or generate 11.01% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
QBE Insurance Group vs. ECHO INVESTMENT ZY
Performance |
Timeline |
QBE Insurance Group |
ECHO INVESTMENT ZY |
QBE Insurance and ECHO INVESTMENT Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with QBE Insurance and ECHO INVESTMENT
The main advantage of trading using opposite QBE Insurance and ECHO INVESTMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if QBE Insurance position performs unexpectedly, ECHO INVESTMENT 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 ECHO INVESTMENT will offset losses from the drop in ECHO INVESTMENT's long position.QBE Insurance vs. Singapore Telecommunications Limited | QBE Insurance vs. Rogers Communications | QBE Insurance vs. CITIC Telecom International | QBE Insurance vs. Chunghwa Telecom Co |
ECHO INVESTMENT vs. Tencent Music Entertainment | ECHO INVESTMENT vs. Singapore Airlines Limited | ECHO INVESTMENT vs. AEGEAN AIRLINES | ECHO INVESTMENT vs. ARDAGH METAL PACDL 0001 |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
Equity Valuation Check real value of public entities based on technical and fundamental data |