Correlation Between Qumei Furniture and Beken Corp

Can any of the company-specific risk be diversified away by investing in both Qumei Furniture and Beken 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 Qumei Furniture and Beken Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Qumei Furniture Group and Beken Corp, you can compare the effects of market volatilities on Qumei Furniture and Beken 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 Qumei Furniture with a short position of Beken Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qumei Furniture and Beken Corp.

Diversification Opportunities for Qumei Furniture and Beken Corp

0.0

Correlation Coefficient

Qumei Furniture  Beken Corp

Pay attention - limited upside

The 3 months correlation between Qumei and Beken is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Qumei Furniture Group and Beken Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beken Corp and Qumei Furniture 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 Qumei Furniture Group are associated (or correlated) with Beken Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beken Corp has no effect on the direction of Qumei Furniture i.e., Qumei Furniture and Beken Corp go up and down completely randomly.

Pair Corralation between Qumei Furniture and Beken Corp

If you would invest  223.00  in Qumei Furniture Group on December 10, 2024 and sell it today you would earn a total of  67.00  from holding Qumei Furniture Group or generate 30.04% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.87%
Values	Daily Returns

Qumei Furniture Group  vs.  Beken Corp

Qumei Furniture Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Qumei Furniture Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Beken Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Beken Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Beken Corp is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Qumei Furniture and Beken Corp

The main advantage of trading using opposite Qumei Furniture and Beken Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qumei Furniture position performs unexpectedly, Beken 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 Beken Corp will offset losses from the drop in Beken Corp's long position.

The idea behind Qumei Furniture Group and Beken 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.