Correlation Between ZEEKR Intelligent and Quantumscape Corp

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Can any of the company-specific risk be diversified away by investing in both ZEEKR Intelligent and Quantumscape Corp 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 ZEEKR Intelligent and Quantumscape Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ZEEKR Intelligent Technology and Quantumscape Corp, you can compare the effects of market volatilities on ZEEKR Intelligent and Quantumscape Corp 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 ZEEKR Intelligent with a short position of Quantumscape Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZEEKR Intelligent and Quantumscape Corp.

Diversification Opportunities for ZEEKR Intelligent and Quantumscape Corp

ZEEKRQuantumscapeDiversified AwayZEEKRQuantumscapeDiversified Away100%
0.4
  Correlation Coefficient

Very weak diversification

The 3 months correlation between ZEEKR and Quantumscape is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding ZEEKR Intelligent Technology and Quantumscape Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quantumscape Corp and ZEEKR Intelligent 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 ZEEKR Intelligent Technology are associated (or correlated) with Quantumscape Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quantumscape Corp has no effect on the direction of ZEEKR Intelligent i.e., ZEEKR Intelligent and Quantumscape Corp go up and down completely randomly.

Pair Corralation between ZEEKR Intelligent and Quantumscape Corp

Allowing for the 90-day total investment horizon ZEEKR Intelligent Technology is expected to generate 1.32 times more return on investment than Quantumscape Corp. However, ZEEKR Intelligent is 1.32 times more volatile than Quantumscape Corp. It trades about 0.05 of its potential returns per unit of risk. Quantumscape Corp is currently generating about 0.02 per unit of risk. If you would invest  2,100  in ZEEKR Intelligent Technology on November 21, 2024 and sell it today you would earn a total of  533.00  from holding ZEEKR Intelligent Technology or generate 25.38% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy86.22%
ValuesDaily Returns

ZEEKR Intelligent Technology  vs.  Quantumscape Corp

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -100102030
JavaScript chart by amCharts 3.21.15ZK QS
       Timeline  
ZEEKR Intelligent 

Risk-Adjusted Performance

OK

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in ZEEKR Intelligent Technology are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite fragile forward-looking signals, ZEEKR Intelligent disclosed solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb222426283032
Quantumscape Corp 

Risk-Adjusted Performance

Insignificant

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Quantumscape Corp are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Quantumscape Corp unveiled solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb55.566.57

ZEEKR Intelligent and Quantumscape Corp Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-18.36-13.75-9.14-4.530.04.569.2713.9818.723.41 0.0100.0120.0140.0160.0180.0200.022
JavaScript chart by amCharts 3.21.15ZK QS
       Returns  

Pair Trading with ZEEKR Intelligent and Quantumscape Corp

The main advantage of trading using opposite ZEEKR Intelligent and Quantumscape Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZEEKR Intelligent position performs unexpectedly, Quantumscape Corp 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 Quantumscape Corp will offset losses from the drop in Quantumscape Corp's long position.
The idea behind ZEEKR Intelligent Technology and Quantumscape Corp 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.
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.

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