Correlation Between BJs Wholesale and QURATE RETAIL
Can any of the company-specific risk be diversified away by investing in both BJs Wholesale and QURATE RETAIL 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 BJs Wholesale and QURATE RETAIL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BJs Wholesale Club and QURATE RETAIL INC, you can compare the effects of market volatilities on BJs Wholesale and QURATE RETAIL 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 BJs Wholesale with a short position of QURATE RETAIL. Check out your portfolio center. Please also check ongoing floating volatility patterns of BJs Wholesale and QURATE RETAIL.
Diversification Opportunities for BJs Wholesale and QURATE RETAIL
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between BJs and QURATE is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding BJs Wholesale Club and QURATE RETAIL INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QURATE RETAIL INC and BJs Wholesale 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 BJs Wholesale Club are associated (or correlated) with QURATE RETAIL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QURATE RETAIL INC has no effect on the direction of BJs Wholesale i.e., BJs Wholesale and QURATE RETAIL go up and down completely randomly.
Pair Corralation between BJs Wholesale and QURATE RETAIL
Assuming the 90 days horizon BJs Wholesale is expected to generate 27.83 times less return on investment than QURATE RETAIL. But when comparing it to its historical volatility, BJs Wholesale Club is 21.39 times less risky than QURATE RETAIL. It trades about 0.13 of its potential returns per unit of risk. QURATE RETAIL INC is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 280.00 in QURATE RETAIL INC on December 5, 2024 and sell it today you would earn a total of 670.00 from holding QURATE RETAIL INC or generate 239.29% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
BJs Wholesale Club vs. QURATE RETAIL INC
Performance |
Timeline |
BJs Wholesale Club |
QURATE RETAIL INC |
BJs Wholesale and QURATE RETAIL Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with BJs Wholesale and QURATE RETAIL
The main advantage of trading using opposite BJs Wholesale and QURATE RETAIL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BJs Wholesale position performs unexpectedly, QURATE RETAIL 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 QURATE RETAIL will offset losses from the drop in QURATE RETAIL's long position.BJs Wholesale vs. Medical Properties Trust | BJs Wholesale vs. Peijia Medical Limited | BJs Wholesale vs. SPORTING | BJs Wholesale vs. PARKEN SPORT ENT |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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