Correlation Between Boqii Holding and Genuine Parts

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Can any of the company-specific risk be diversified away by investing in both Boqii Holding and Genuine Parts 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 Genuine Parts into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boqii Holding and Genuine Parts, you can compare the effects of market volatilities on Boqii Holding and Genuine Parts 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 Genuine Parts. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boqii Holding and Genuine Parts.

Diversification Opportunities for Boqii Holding and Genuine Parts

-0.34
  Correlation Coefficient

Very good diversification

The 3 months correlation between Boqii and Genuine is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Boqii Holding Ltd and Genuine Parts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genuine Parts 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 are associated (or correlated) with Genuine Parts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genuine Parts has no effect on the direction of Boqii Holding i.e., Boqii Holding and Genuine Parts go up and down completely randomly.

Pair Corralation between Boqii Holding and Genuine Parts

Allowing for the 90-day total investment horizon Boqii Holding is expected to under-perform the Genuine Parts. In addition to that, Boqii Holding is 3.55 times more volatile than Genuine Parts. It trades about -0.11 of its total potential returns per unit of risk. Genuine Parts is currently generating about 0.05 per unit of volatility. If you would invest  12,645  in Genuine Parts on April 6, 2022 and sell it today you would earn a total of  879.00  from holding Genuine Parts or generate 6.95% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Boqii Holding Ltd  vs.  Genuine Parts

 Performance (%) 
      Timeline 
Boqii Holding 
Boqii Performance
0 of 100
Over the last 90 days Boqii Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in August 2022. The recent disarray may also be a sign of long period up-swing for the firm insiders.

Structure and Payout Changes

Last Split Factor
1:6
Last Split Date
2022-06-03

Boqii Price Channel

Genuine Parts 
Genuine Performance
5 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Genuine Parts are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat conflicting basic indicators, Genuine Parts may actually be approaching a critical reversion point that can send shares even higher in August 2022.

Structure and Payout Changes

Forward Annual Dividend Yield
0.0268
Payout Ratio
0.47
Last Split Factor
3:2
Forward Annual Dividend Rate
3.58
Dividend Date
2022-07-01
Ex Dividend Date
2022-06-02
Last Split Date
1997-04-15

Genuine Price Channel

Boqii Holding and Genuine Parts Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Boqii Holding and Genuine Parts

The main advantage of trading using opposite Boqii Holding and Genuine Parts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boqii Holding position performs unexpectedly, Genuine Parts 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 Genuine Parts will offset losses from the drop in Genuine Parts' long position.
The idea behind Boqii Holding and Genuine Parts 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.
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 Commodity Channel Index module to use Commodity Channel Index to analyze current equity momentum.

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