Correlation Between Qurate Retail and Jd Com Inc

Can any of the company-specific risk be diversified away by investing in both Qurate Retail and Jd Com Inc 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 Qurate Retail and Jd Com Inc into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Qurate Retail Series and Jd Com Inc, you can compare the effects of market volatilities on Qurate Retail and Jd Com Inc 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 Qurate Retail with a short position of Jd Com Inc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qurate Retail and Jd Com Inc.

Diversification Opportunities for Qurate Retail and Jd Com Inc

-0.03

Correlation Coefficient

Qurate Retail  Jd Com Inc

Good diversification

The 3 months correlation between Qurate and JDCMF is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Qurate Retail Series and Jd Com Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jd Com Inc and Qurate Retail 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 Qurate Retail Series are associated (or correlated) with Jd Com Inc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jd Com Inc has no effect on the direction of Qurate Retail i.e., Qurate Retail and Jd Com Inc go up and down completely randomly.

Pair Corralation between Qurate Retail and Jd Com Inc

Assuming the 90 days horizon Qurate Retail Series is expected to under-perform the Jd Com Inc. But the stock apears to be less risky and, when comparing its historical volatility, Qurate Retail Series is 1.71 times less risky than Jd Com Inc. The stock trades about -0.07 of its potential returns per unit of risk. The Jd Com Inc is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  1,443  in Jd Com Inc on August 30, 2024 and sell it today you would earn a total of  274.00  from holding Jd Com Inc or generate 18.99% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Qurate Retail Series  vs.  Jd Com Inc

Qurate Retail Series

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Qurate Retail Series 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 technical and fundamental indicators remain somewhat strong which may send shares a bit higher in December 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Jd Com Inc

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Jd Com Inc are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly abnormal primary indicators, Jd Com Inc reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Qurate Retail and Jd Com Inc

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

The idea behind Qurate Retail Series and Jd Com Inc 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.