Correlation Between Qudian and Investcorp Europe
Can any of the company-specific risk be diversified away by investing in both Qudian and Investcorp Europe 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 Qudian and Investcorp Europe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Qudian Inc and Investcorp Europe Acquisition, you can compare the effects of market volatilities on Qudian and Investcorp Europe 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 Qudian with a short position of Investcorp Europe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qudian and Investcorp Europe.
Diversification Opportunities for Qudian and Investcorp Europe
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Qudian and Investcorp is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Qudian Inc and Investcorp Europe Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investcorp Europe and Qudian 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 Qudian Inc are associated (or correlated) with Investcorp Europe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investcorp Europe has no effect on the direction of Qudian i.e., Qudian and Investcorp Europe go up and down completely randomly.
Pair Corralation between Qudian and Investcorp Europe
Allowing for the 90-day total investment horizon Qudian is expected to generate 130.81 times less return on investment than Investcorp Europe. But when comparing it to its historical volatility, Qudian Inc is 46.38 times less risky than Investcorp Europe. It trades about 0.06 of its potential returns per unit of risk. Investcorp Europe Acquisition is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 24.00 in Investcorp Europe Acquisition on September 1, 2024 and sell it today you would lose (22.72) from holding Investcorp Europe Acquisition or give up 94.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 45.74% |
| Values | Daily Returns |
Qudian Inc vs. Investcorp Europe Acquisition
Performance |
| Timeline |
| Qudian Inc |
| Investcorp Europe |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
Qudian and Investcorp Europe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qudian and Investcorp Europe
The main advantage of trading using opposite Qudian and Investcorp Europe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qudian position performs unexpectedly, Investcorp Europe 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 Investcorp Europe will offset losses from the drop in Investcorp Europe's long position.| Qudian vs. X Financial Class | Qudian vs. FinVolution Group | Qudian vs. Senmiao Technology | Qudian vs. Lexinfintech Holdings |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |