Correlation Between Boqii Holding and Foot Locker
Can any of the company-specific risk be diversified away by investing in both Boqii Holding and Foot Locker 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 Boqii Holding and Foot Locker into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boqii Holding Limited and Foot Locker, you can compare the effects of market volatilities on Boqii Holding and Foot Locker 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 Boqii Holding with a short position of Foot Locker. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boqii Holding and Foot Locker.
Diversification Opportunities for Boqii Holding and Foot Locker
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Boqii and Foot is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Boqii Holding Limited and Foot Locker in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Foot Locker and Boqii 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 Boqii Holding Limited are associated (or correlated) with Foot Locker. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Foot Locker has no effect on the direction of Boqii Holding i.e., Boqii Holding and Foot Locker go up and down completely randomly.
Pair Corralation between Boqii Holding and Foot Locker
Allowing for the 90-day total investment horizon Boqii Holding Limited is expected to under-perform the Foot Locker. In addition to that, Boqii Holding is 1.39 times more volatile than Foot Locker. It trades about -0.46 of its total potential returns per unit of risk. Foot Locker is currently generating about -0.18 per unit of volatility. If you would invest 2,456 in Foot Locker on September 26, 2024 and sell it today you would lose (277.00) from holding Foot Locker or give up 11.28% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Boqii Holding Limited vs. Foot Locker
Performance |
Timeline |
Boqii Holding Limited |
Foot Locker |
Boqii Holding and Foot Locker Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Boqii Holding and Foot Locker
The main advantage of trading using opposite Boqii Holding and Foot Locker positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boqii Holding position performs unexpectedly, Foot Locker 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 Foot Locker will offset losses from the drop in Foot Locker's long position.Boqii Holding vs. PDD Holdings | Boqii Holding vs. Alibaba Group Holding | Boqii Holding vs. Sea | Boqii Holding vs. Wayfair |
Foot Locker vs. Macys Inc | Foot Locker vs. Wayfair | Foot Locker vs. 1StdibsCom | Foot Locker vs. AutoNation |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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