Correlation Between Boqii Holding and TheRealReal
Can any of the company-specific risk be diversified away by investing in both Boqii Holding and TheRealReal 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 TheRealReal 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 TheRealReal, you can compare the effects of market volatilities on Boqii Holding and TheRealReal 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 TheRealReal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boqii Holding and TheRealReal.
Diversification Opportunities for Boqii Holding and TheRealReal
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Boqii and TheRealReal is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Boqii Holding Limited and TheRealReal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TheRealReal 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 TheRealReal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TheRealReal has no effect on the direction of Boqii Holding i.e., Boqii Holding and TheRealReal go up and down completely randomly.
Pair Corralation between Boqii Holding and TheRealReal
Allowing for the 90-day total investment horizon Boqii Holding Limited is expected to under-perform the TheRealReal. In addition to that, Boqii Holding is 1.3 times more volatile than TheRealReal. It trades about -0.18 of its total potential returns per unit of risk. TheRealReal is currently generating about -0.06 per unit of volatility. If you would invest 623.00 in TheRealReal on December 31, 2024 and sell it today you would lose (61.00) from holding TheRealReal or give up 9.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Boqii Holding Limited vs. TheRealReal
Performance |
| Timeline |
| Boqii Holding Limited |
| TheRealReal |
Boqii Holding and TheRealReal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boqii Holding and TheRealReal
The main advantage of trading using opposite Boqii Holding and TheRealReal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boqii Holding position performs unexpectedly, TheRealReal 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 TheRealReal will offset losses from the drop in TheRealReal's long position.| Boqii Holding vs. Card Factory plc | ||
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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