Correlation Between Boqii Holding and Five Below
Can any of the company-specific risk be diversified away by investing in both Boqii Holding and Five Below 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 Five Below 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 Five Below, you can compare the effects of market volatilities on Boqii Holding and Five Below 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 Five Below. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boqii Holding and Five Below.
Diversification Opportunities for Boqii Holding and Five Below
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Boqii and Five is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Boqii Holding Limited and Five Below in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Five Below 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 Five Below. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Five Below has no effect on the direction of Boqii Holding i.e., Boqii Holding and Five Below go up and down completely randomly.
Pair Corralation between Boqii Holding and Five Below
Allowing for the 90-day total investment horizon Boqii Holding Limited is expected to generate 2.22 times more return on investment than Five Below. However, Boqii Holding is 2.22 times more volatile than Five Below. It trades about 0.02 of its potential returns per unit of risk. Five Below is currently generating about -0.06 per unit of risk. If you would invest 48.00 in Boqii Holding Limited on September 2, 2024 and sell it today you would lose (8.00) from holding Boqii Holding Limited or give up 16.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boqii Holding Limited vs. Five Below
Performance |
| Timeline |
| Boqii Holding Limited |
| Five Below |
Boqii Holding and Five Below Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boqii Holding and Five Below
The main advantage of trading using opposite Boqii Holding and Five Below positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boqii Holding position performs unexpectedly, Five Below 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 Five Below will offset losses from the drop in Five Below'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 |
| Five Below vs. OReilly Automotive | Five Below vs. AutoZone | Five Below vs. Genuine Parts Co | Five Below vs. Williams Sonoma |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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