Correlation Between Kweichow Moutai and Northking Information
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By analyzing existing cross correlation between Kweichow Moutai Co and Northking Information Technology, you can compare the effects of market volatilities on Kweichow Moutai and Northking Information 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 Northking Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kweichow Moutai and Northking Information.
Diversification Opportunities for Kweichow Moutai and Northking Information
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kweichow and Northking is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Kweichow Moutai Co and Northking Information Technolo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Northking Information 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 Northking Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Northking Information has no effect on the direction of Kweichow Moutai i.e., Kweichow Moutai and Northking Information go up and down completely randomly.
Pair Corralation between Kweichow Moutai and Northking Information
Assuming the 90 days trading horizon Kweichow Moutai Co is expected to generate 0.52 times more return on investment than Northking Information. However, Kweichow Moutai Co is 1.94 times less risky than Northking Information. It trades about -0.1 of its potential returns per unit of risk. Northking Information Technology is currently generating about -0.13 per unit of risk. If you would invest 156,500 in Kweichow Moutai Co on August 29, 2024 and sell it today you would lose (5,600) from holding Kweichow Moutai Co or give up 3.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kweichow Moutai Co vs. Northking Information Technolo
Performance |
| Timeline |
| Kweichow Moutai |
| Northking Information |
Kweichow Moutai and Northking Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kweichow Moutai and Northking Information
The main advantage of trading using opposite Kweichow Moutai and Northking Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kweichow Moutai position performs unexpectedly, Northking Information 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 Northking Information will offset losses from the drop in Northking Information's long position.| Kweichow Moutai vs. PetroChina Co Ltd | Kweichow Moutai vs. China Mobile Limited | Kweichow Moutai vs. Ping An Insurance | Kweichow Moutai vs. China Petroleum Chemical |
| Northking Information vs. China State Construction | Northking Information vs. Huafa Industrial Co | Northking Information vs. China International Capital | Northking Information vs. Kweichow Moutai 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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