Correlation Between Espey Mfg and QVC

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

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

Diversification Opportunities for Espey Mfg and QVC

-0.82

Correlation Coefficient

Espey Mfg  QVC

Pay attention - limited upside

The 3 months correlation between Espey and QVC is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Espey Mfg Electronics and QVC Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QVC Group and Espey Mfg 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 Espey Mfg Electronics are associated (or correlated) with QVC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QVC Group has no effect on the direction of Espey Mfg i.e., Espey Mfg and QVC go up and down completely randomly.

Pair Corralation between Espey Mfg and QVC

Considering the 90-day investment horizon Espey Mfg Electronics is expected to generate 0.24 times more return on investment than QVC. However, Espey Mfg Electronics is 4.16 times less risky than QVC. It trades about 0.33 of its potential returns per unit of risk. QVC Group is currently generating about -0.07 per unit of risk. If you would invest  3,091  in Espey Mfg Electronics on April 25, 2025 and sell it today you would earn a total of  2,143  from holding Espey Mfg Electronics or generate 69.33% return on investment over 90 days.

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

Espey Mfg Electronics  vs.  QVC Group

Espey Mfg Electronics

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Espey Mfg Electronics are ranked lower than 26 (%) of all global equities and portfolios over the last 90 days. Even with relatively inconsistent basic indicators, Espey Mfg reported solid returns over the last few months and may actually be approaching a breakup point.

QVC Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days QVC Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's technical and fundamental indicators remain somewhat strong which may send shares a bit higher in August 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Espey Mfg and QVC

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

The idea behind Espey Mfg Electronics and QVC Group 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.