Correlation Between Anhui Gujing and Kweichow Moutai
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By analyzing existing cross correlation between Anhui Gujing Distillery and Kweichow Moutai Co, you can compare the effects of market volatilities on Anhui Gujing and Kweichow Moutai 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 Anhui Gujing with a short position of Kweichow Moutai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Gujing and Kweichow Moutai.
Diversification Opportunities for Anhui Gujing and Kweichow Moutai
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Anhui and Kweichow is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Gujing Distillery and Kweichow Moutai Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kweichow Moutai and Anhui Gujing 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 Anhui Gujing Distillery are associated (or correlated) with Kweichow Moutai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kweichow Moutai has no effect on the direction of Anhui Gujing i.e., Anhui Gujing and Kweichow Moutai go up and down completely randomly.
Pair Corralation between Anhui Gujing and Kweichow Moutai
Assuming the 90 days trading horizon Anhui Gujing Distillery is expected to under-perform the Kweichow Moutai. In addition to that, Anhui Gujing is 1.88 times more volatile than Kweichow Moutai Co. It trades about -0.09 of its total potential returns per unit of risk. Kweichow Moutai Co is currently generating about -0.12 per unit of volatility. If you would invest 156,500 in Kweichow Moutai Co on August 28, 2024 and sell it today you would lose (6,643) from holding Kweichow Moutai Co or give up 4.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anhui Gujing Distillery vs. Kweichow Moutai Co
Performance |
| Timeline |
| Anhui Gujing Distillery |
| Kweichow Moutai |
Anhui Gujing and Kweichow Moutai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Gujing and Kweichow Moutai
The main advantage of trading using opposite Anhui Gujing and Kweichow Moutai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Gujing position performs unexpectedly, Kweichow Moutai 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 Kweichow Moutai will offset losses from the drop in Kweichow Moutai's long position.| Anhui Gujing vs. BYD Co Ltd | Anhui Gujing vs. China Mobile Limited | Anhui Gujing vs. Agricultural Bank of | Anhui Gujing vs. Industrial and Commercial |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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