Correlation Between Qurate Retail and Alibaba Group
Can any of the company-specific risk be diversified away by investing in both Qurate Retail and Alibaba Group 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 Qurate Retail and Alibaba Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Qurate Retail Series and Alibaba Group Holding, you can compare the effects of market volatilities on Qurate Retail and Alibaba Group 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 Qurate Retail with a short position of Alibaba Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qurate Retail and Alibaba Group.
Diversification Opportunities for Qurate Retail and Alibaba Group
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Qurate and Alibaba is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Qurate Retail Series and Alibaba Group Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alibaba Group Holding and Qurate Retail 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 Qurate Retail Series are associated (or correlated) with Alibaba Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alibaba Group Holding has no effect on the direction of Qurate Retail i.e., Qurate Retail and Alibaba Group go up and down completely randomly.
Pair Corralation between Qurate Retail and Alibaba Group
Assuming the 90 days horizon Qurate Retail is expected to generate 34.78 times less return on investment than Alibaba Group. In addition to that, Qurate Retail is 1.72 times more volatile than Alibaba Group Holding. It trades about 0.0 of its total potential returns per unit of risk. Alibaba Group Holding is currently generating about 0.02 per unit of volatility. If you would invest 1,230 in Alibaba Group Holding on November 2, 2024 and sell it today you would lose (7.00) from holding Alibaba Group Holding or give up 0.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Qurate Retail Series vs. Alibaba Group Holding
Performance |
| Timeline |
| Qurate Retail Series |
| Alibaba Group Holding |
Qurate Retail and Alibaba Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qurate Retail and Alibaba Group
The main advantage of trading using opposite Qurate Retail and Alibaba Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qurate Retail position performs unexpectedly, Alibaba Group 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 Alibaba Group will offset losses from the drop in Alibaba Group's long position.| Qurate Retail vs. Qurate Retail | Qurate Retail vs. Newegg Commerce | Qurate Retail vs. Kidpik Corp | Qurate Retail vs. Natural Health Trend |
| Alibaba Group vs. Meituan ADR | Alibaba Group vs. Meituan | Alibaba Group vs. Qurate Retail Series | Alibaba Group vs. ThredUp |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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