Correlation Between Qudian and Blue Owl
Can any of the company-specific risk be diversified away by investing in both Qudian and Blue Owl 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 Blue Owl into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Qudian Inc and Blue Owl Capital, you can compare the effects of market volatilities on Qudian and Blue Owl 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 Blue Owl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qudian and Blue Owl.
Diversification Opportunities for Qudian and Blue Owl
Poor diversification
The 3 months correlation between Qudian and Blue is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Qudian Inc and Blue Owl Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Owl Capital 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 Blue Owl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Owl Capital has no effect on the direction of Qudian i.e., Qudian and Blue Owl go up and down completely randomly.
Pair Corralation between Qudian and Blue Owl
Allowing for the 90-day total investment horizon Qudian Inc is expected to under-perform the Blue Owl. In addition to that, Qudian is 2.35 times more volatile than Blue Owl Capital. It trades about -0.11 of its total potential returns per unit of risk. Blue Owl Capital is currently generating about -0.04 per unit of volatility. If you would invest 1,531 in Blue Owl Capital on August 28, 2024 and sell it today you would lose (18.00) from holding Blue Owl Capital or give up 1.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Qudian Inc vs. Blue Owl Capital
Performance |
| Timeline |
| Qudian Inc |
| Blue Owl Capital |
Qudian and Blue Owl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qudian and Blue Owl
The main advantage of trading using opposite Qudian and Blue Owl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qudian position performs unexpectedly, Blue Owl 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 Blue Owl will offset losses from the drop in Blue Owl's long position.| Qudian vs. Orix Corp Ads | Qudian vs. Medallion Financial Corp | Qudian vs. Oportun Financial Corp | Qudian vs. SLM Corp Pb |
| Blue Owl vs. Aurora Innovation | Blue Owl vs. HUMANA INC | Blue Owl vs. Aquagold International | Blue Owl vs. Barloworld Ltd ADR |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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