Correlation Between Kweichow Moutai and King Strong
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By analyzing existing cross correlation between Kweichow Moutai Co and King Strong New Material, you can compare the effects of market volatilities on Kweichow Moutai and King Strong 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 King Strong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kweichow Moutai and King Strong.
Diversification Opportunities for Kweichow Moutai and King Strong
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kweichow and King is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Kweichow Moutai Co and King Strong New Material in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on King Strong New 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 King Strong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of King Strong New has no effect on the direction of Kweichow Moutai i.e., Kweichow Moutai and King Strong go up and down completely randomly.
Pair Corralation between Kweichow Moutai and King Strong
Assuming the 90 days trading horizon Kweichow Moutai Co is expected to generate 0.42 times more return on investment than King Strong. However, Kweichow Moutai Co is 2.37 times less risky than King Strong. It trades about -0.28 of its potential returns per unit of risk. King Strong New Material is currently generating about -0.2 per unit of risk. If you would invest 153,882 in Kweichow Moutai Co on October 25, 2024 and sell it today you would lose (9,782) from holding Kweichow Moutai Co or give up 6.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kweichow Moutai Co vs. King Strong New Material
Performance |
| Timeline |
| Kweichow Moutai |
| King Strong New |
Kweichow Moutai and King Strong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kweichow Moutai and King Strong
The main advantage of trading using opposite Kweichow Moutai and King Strong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kweichow Moutai position performs unexpectedly, King Strong 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 King Strong will offset losses from the drop in King Strong's long position.| Kweichow Moutai vs. Southchip Semiconductor Technology | Kweichow Moutai vs. Yingde Greatchem Chemicals | Kweichow Moutai vs. Aba Chemicals Corp | Kweichow Moutai vs. Easyhome New Retail |
| King Strong vs. Kweichow Moutai Co | King Strong vs. Contemporary Amperex Technology | King Strong vs. Beijing Roborock Technology | King Strong vs. BYD Co Ltd |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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