Correlation Between Quizam Media and ITM Power

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

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

Diversification Opportunities for Quizam Media and ITM Power

0.3

Correlation Coefficient

Quizam Media  ITM Power

Weak diversification

The 3 months correlation between Quizam and ITM is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Quizam Media and ITM Power Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ITM Power Plc and Quizam Media 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 Quizam Media are associated (or correlated) with ITM Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ITM Power Plc has no effect on the direction of Quizam Media i.e., Quizam Media and ITM Power go up and down completely randomly.

Pair Corralation between Quizam Media and ITM Power

Assuming the 90 days horizon Quizam Media is expected to generate 1.22 times less return on investment than ITM Power. In addition to that, Quizam Media is 1.78 times more volatile than ITM Power Plc. It trades about 0.08 of its total potential returns per unit of risk. ITM Power Plc is currently generating about 0.17 per unit of volatility. If you would invest  43.00  in ITM Power Plc on May 3, 2025 and sell it today you would earn a total of  36.00  from holding ITM Power Plc or generate 83.72% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	96.88%
Values	Daily Returns

Quizam Media  vs.  ITM Power Plc

Quizam Media

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Quizam Media are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Quizam Media reported solid returns over the last few months and may actually be approaching a breakup point.

ITM Power Plc

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in ITM Power Plc are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, ITM Power reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Quizam Media and ITM Power

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

The idea behind Quizam Media and ITM Power Plc 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 Positions Ratings module to 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.