Correlation Between Boqii Holding and AutoNation
Can any of the company-specific risk be diversified away by investing in both Boqii Holding and AutoNation 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 Boqii Holding and AutoNation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boqii Holding Limited and AutoNation, you can compare the effects of market volatilities on Boqii Holding and AutoNation 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 Boqii Holding with a short position of AutoNation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boqii Holding and AutoNation.
Diversification Opportunities for Boqii Holding and AutoNation
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Boqii and AutoNation is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Boqii Holding Limited and AutoNation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AutoNation and Boqii Holding 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 Boqii Holding Limited are associated (or correlated) with AutoNation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AutoNation has no effect on the direction of Boqii Holding i.e., Boqii Holding and AutoNation go up and down completely randomly.
Pair Corralation between Boqii Holding and AutoNation
Allowing for the 90-day total investment horizon Boqii Holding Limited is expected to under-perform the AutoNation. In addition to that, Boqii Holding is 4.22 times more volatile than AutoNation. It trades about -0.1 of its total potential returns per unit of risk. AutoNation is currently generating about 0.5 per unit of volatility. If you would invest 16,694 in AutoNation on November 2, 2024 and sell it today you would earn a total of 2,085 from holding AutoNation or generate 12.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boqii Holding Limited vs. AutoNation
Performance |
| Timeline |
| Boqii Holding Limited |
| AutoNation |
Boqii Holding and AutoNation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boqii Holding and AutoNation
The main advantage of trading using opposite Boqii Holding and AutoNation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boqii Holding position performs unexpectedly, AutoNation 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 AutoNation will offset losses from the drop in AutoNation's long position.| Boqii Holding vs. Card Factory plc | Boqii Holding vs. School Specialty | Boqii Holding vs. Ceconomy AG ADR | Boqii Holding vs. Bowlin Travel Centers |
| AutoNation vs. Sonic Automotive | AutoNation vs. Lithia Motors | AutoNation vs. Asbury Automotive Group | AutoNation vs. Penske Automotive Group |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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