Correlation Between Huize Holding and Boqii Holding
Can any of the company-specific risk be diversified away by investing in both Huize Holding and Boqii Holding 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 Huize Holding and Boqii Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Huize Holding and Boqii Holding Limited, you can compare the effects of market volatilities on Huize Holding and Boqii Holding 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 Huize Holding with a short position of Boqii Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huize Holding and Boqii Holding.
Diversification Opportunities for Huize Holding and Boqii Holding
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Huize and Boqii is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Huize Holding and Boqii Holding Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boqii Holding Limited and Huize Holding 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 Huize Holding are associated (or correlated) with Boqii Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boqii Holding Limited has no effect on the direction of Huize Holding i.e., Huize Holding and Boqii Holding go up and down completely randomly.
Pair Corralation between Huize Holding and Boqii Holding
Given the investment horizon of 90 days Huize Holding is expected to generate 20.85 times more return on investment than Boqii Holding. However, Huize Holding is 20.85 times more volatile than Boqii Holding Limited. It trades about 0.12 of its potential returns per unit of risk. Boqii Holding Limited is currently generating about -0.06 per unit of risk. If you would invest 60.00 in Huize Holding on December 1, 2024 and sell it today you would earn a total of 284.00 from holding Huize Holding or generate 473.33% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Huize Holding vs. Boqii Holding Limited
Performance |
Timeline |
Huize Holding |
Boqii Holding Limited |
Huize Holding and Boqii Holding Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Huize Holding and Boqii Holding
The main advantage of trading using opposite Huize Holding and Boqii Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huize Holding position performs unexpectedly, Boqii Holding 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 Boqii Holding will offset losses from the drop in Boqii Holding's long position.Huize Holding vs. CorVel Corp | Huize Holding vs. Erie Indemnity | Huize Holding vs. Crawford Company | Huize Holding vs. eHealth |
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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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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