Correlation Between Kweichow Moutai and Xinjiang Communications
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By analyzing existing cross correlation between Kweichow Moutai Co and Xinjiang Communications Construction, you can compare the effects of market volatilities on Kweichow Moutai and Xinjiang 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 Xinjiang Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kweichow Moutai and Xinjiang Communications.
Diversification Opportunities for Kweichow Moutai and Xinjiang Communications
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kweichow and Xinjiang is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Kweichow Moutai Co and Xinjiang Communications Constr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang 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 Xinjiang Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Communications has no effect on the direction of Kweichow Moutai i.e., Kweichow Moutai and Xinjiang Communications go up and down completely randomly.
Pair Corralation between Kweichow Moutai and Xinjiang Communications
Assuming the 90 days trading horizon Kweichow Moutai Co is expected to under-perform the Xinjiang Communications. But the stock apears to be less risky and, when comparing its historical volatility, Kweichow Moutai Co is 1.92 times less risky than Xinjiang Communications. The stock trades about -0.14 of its potential returns per unit of risk. The Xinjiang Communications Construction is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 1,252 in Xinjiang Communications Construction on September 13, 2024 and sell it today you would earn a total of 56.00 from holding Xinjiang Communications Construction or generate 4.47% 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. Xinjiang Communications Constr
Performance |
| Timeline |
| Kweichow Moutai |
| Xinjiang Communications |
Kweichow Moutai and Xinjiang Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kweichow Moutai and Xinjiang Communications
The main advantage of trading using opposite Kweichow Moutai and Xinjiang Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kweichow Moutai position performs unexpectedly, Xinjiang 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 Xinjiang Communications will offset losses from the drop in Xinjiang Communications' long position.| Kweichow Moutai vs. China Publishing Media | Kweichow Moutai vs. China Sports Industry | Kweichow Moutai vs. Shuhua Sports Co | Kweichow Moutai vs. Jiangsu Jinling Sports |
| Xinjiang Communications vs. Industrial and Commercial | Xinjiang Communications vs. Kweichow Moutai Co | Xinjiang Communications vs. Agricultural Bank of | Xinjiang Communications vs. China Mobile Limited |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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