Correlation Between Boqii Holding and Aterian
Can any of the company-specific risk be diversified away by investing in both Boqii Holding and Aterian 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 Aterian 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 Aterian, you can compare the effects of market volatilities on Boqii Holding and Aterian 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 Aterian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boqii Holding and Aterian.
Diversification Opportunities for Boqii Holding and Aterian
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Boqii and Aterian is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Boqii Holding Limited and Aterian in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aterian 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 Aterian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aterian has no effect on the direction of Boqii Holding i.e., Boqii Holding and Aterian go up and down completely randomly.
Pair Corralation between Boqii Holding and Aterian
Allowing for the 90-day total investment horizon Boqii Holding Limited is expected to generate 2.33 times more return on investment than Aterian. However, Boqii Holding is 2.33 times more volatile than Aterian. It trades about 0.02 of its potential returns per unit of risk. Aterian is currently generating about -0.05 per unit of risk. If you would invest 170.00 in Boqii Holding Limited on August 27, 2024 and sell it today you would lose (120.00) from holding Boqii Holding Limited or give up 70.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boqii Holding Limited vs. Aterian
Performance |
| Timeline |
| Boqii Holding Limited |
| Aterian |
Boqii Holding and Aterian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boqii Holding and Aterian
The main advantage of trading using opposite Boqii Holding and Aterian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boqii Holding position performs unexpectedly, Aterian 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 Aterian will offset losses from the drop in Aterian's long position.| Boqii Holding vs. Sea | Boqii Holding vs. Wayfair | Boqii Holding vs. Chewy Inc | Boqii Holding vs. Vipshop Holdings Limited |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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