Correlation Between Kweichow Moutai and Sunwave Communications
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By analyzing existing cross correlation between Kweichow Moutai Co and Sunwave Communications Co, you can compare the effects of market volatilities on Kweichow Moutai and Sunwave Communications 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 Kweichow Moutai with a short position of Sunwave Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kweichow Moutai and Sunwave Communications.
Diversification Opportunities for Kweichow Moutai and Sunwave Communications
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kweichow and Sunwave is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Kweichow Moutai Co and Sunwave Communications Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunwave Communications and Kweichow Moutai 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 Kweichow Moutai Co are associated (or correlated) with Sunwave Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunwave Communications has no effect on the direction of Kweichow Moutai i.e., Kweichow Moutai and Sunwave Communications go up and down completely randomly.
Pair Corralation between Kweichow Moutai and Sunwave Communications
Assuming the 90 days trading horizon Kweichow Moutai Co is expected to under-perform the Sunwave Communications. But the stock apears to be less risky and, when comparing its historical volatility, Kweichow Moutai Co is 2.54 times less risky than Sunwave Communications. The stock trades about -0.11 of its potential returns per unit of risk. The Sunwave Communications Co is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 568.00 in Sunwave Communications Co on August 27, 2024 and sell it today you would earn a total of 26.00 from holding Sunwave Communications Co or generate 4.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kweichow Moutai Co vs. Sunwave Communications Co
Performance |
| Timeline |
| Kweichow Moutai |
| Sunwave Communications |
Kweichow Moutai and Sunwave Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kweichow Moutai and Sunwave Communications
The main advantage of trading using opposite Kweichow Moutai and Sunwave Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kweichow Moutai position performs unexpectedly, Sunwave Communications 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 Sunwave Communications will offset losses from the drop in Sunwave Communications' long position.| Kweichow Moutai vs. 360 Security Technology | Kweichow Moutai vs. Dezhan HealthCare Co | Kweichow Moutai vs. Youngy Health Co | Kweichow Moutai vs. Mingchen Health Co |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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