Correlation Between Qudian and Zhibao Technology
Can any of the company-specific risk be diversified away by investing in both Qudian and Zhibao Technology 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 Zhibao Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Qudian Inc and Zhibao Technology Class, you can compare the effects of market volatilities on Qudian and Zhibao Technology 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 Zhibao Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qudian and Zhibao Technology.
Diversification Opportunities for Qudian and Zhibao Technology
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Qudian and Zhibao is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Qudian Inc and Zhibao Technology Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhibao Technology Class 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 Zhibao Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhibao Technology Class has no effect on the direction of Qudian i.e., Qudian and Zhibao Technology go up and down completely randomly.
Pair Corralation between Qudian and Zhibao Technology
Allowing for the 90-day total investment horizon Qudian Inc is expected to generate 0.6 times more return on investment than Zhibao Technology. However, Qudian Inc is 1.65 times less risky than Zhibao Technology. It trades about 0.12 of its potential returns per unit of risk. Zhibao Technology Class is currently generating about -0.05 per unit of risk. If you would invest 202.00 in Qudian Inc on August 27, 2024 and sell it today you would earn a total of 32.00 from holding Qudian Inc or generate 15.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Qudian Inc vs. Zhibao Technology Class
Performance |
| Timeline |
| Qudian Inc |
| Zhibao Technology Class |
Qudian and Zhibao Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qudian and Zhibao Technology
The main advantage of trading using opposite Qudian and Zhibao Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qudian position performs unexpectedly, Zhibao Technology 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 Zhibao Technology will offset losses from the drop in Zhibao Technology's long position.The idea behind Qudian Inc and Zhibao Technology Class pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Zhibao Technology vs. Repligen | Zhibao Technology vs. Universal Technical Institute | Zhibao Technology vs. Nuvalent | Zhibao Technology vs. Udemy Inc |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| 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 | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |