Correlation Between Kweichow Moutai and Huizhou Desay
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By analyzing existing cross correlation between Kweichow Moutai Co and Huizhou Desay SV, you can compare the effects of market volatilities on Kweichow Moutai and Huizhou Desay 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 Huizhou Desay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kweichow Moutai and Huizhou Desay.
Diversification Opportunities for Kweichow Moutai and Huizhou Desay
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kweichow and Huizhou is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Kweichow Moutai Co and Huizhou Desay SV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huizhou Desay SV 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 Huizhou Desay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huizhou Desay SV has no effect on the direction of Kweichow Moutai i.e., Kweichow Moutai and Huizhou Desay go up and down completely randomly.
Pair Corralation between Kweichow Moutai and Huizhou Desay
Assuming the 90 days trading horizon Kweichow Moutai Co is expected to under-perform the Huizhou Desay. But the stock apears to be less risky and, when comparing its historical volatility, Kweichow Moutai Co is 2.06 times less risky than Huizhou Desay. The stock trades about -0.02 of its potential returns per unit of risk. The Huizhou Desay SV is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 12,646 in Huizhou Desay SV on October 30, 2024 and sell it today you would lose (1,795) from holding Huizhou Desay SV or give up 14.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.79% |
| Values | Daily Returns |
Kweichow Moutai Co vs. Huizhou Desay SV
Performance |
| Timeline |
| Kweichow Moutai |
| Huizhou Desay SV |
Kweichow Moutai and Huizhou Desay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kweichow Moutai and Huizhou Desay
The main advantage of trading using opposite Kweichow Moutai and Huizhou Desay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kweichow Moutai position performs unexpectedly, Huizhou Desay 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 Huizhou Desay will offset losses from the drop in Huizhou Desay's long position.| Kweichow Moutai vs. Shanghai Yanpu Metal | Kweichow Moutai vs. Citic Guoan Wine | Kweichow Moutai vs. UCloud Technology Co | Kweichow Moutai vs. Maxvision Technology Corp |
| Huizhou Desay vs. Peoples Insurance of | Huizhou Desay vs. Guangdong Jinma Entertainment | Huizhou Desay vs. Ping An Insurance | Huizhou Desay vs. Jiangxi Naipu Mining |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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