Correlation Between Kweichow Moutai and Tianjin Hi
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By analyzing existing cross correlation between Kweichow Moutai Co and Tianjin Hi Tech Development, you can compare the effects of market volatilities on Kweichow Moutai and Tianjin Hi 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 Tianjin Hi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kweichow Moutai and Tianjin Hi.
Diversification Opportunities for Kweichow Moutai and Tianjin Hi
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kweichow and Tianjin is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Kweichow Moutai Co and Tianjin Hi Tech Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tianjin Hi Tech 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 Tianjin Hi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tianjin Hi Tech has no effect on the direction of Kweichow Moutai i.e., Kweichow Moutai and Tianjin Hi go up and down completely randomly.
Pair Corralation between Kweichow Moutai and Tianjin Hi
Assuming the 90 days trading horizon Kweichow Moutai Co is expected to under-perform the Tianjin Hi. But the stock apears to be less risky and, when comparing its historical volatility, Kweichow Moutai Co is 2.06 times less risky than Tianjin Hi. The stock trades about -0.1 of its potential returns per unit of risk. The Tianjin Hi Tech Development is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 306.00 in Tianjin Hi Tech Development on August 28, 2024 and sell it today you would lose (7.00) from holding Tianjin Hi Tech Development or give up 2.29% 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. Tianjin Hi Tech Development
Performance |
| Timeline |
| Kweichow Moutai |
| Tianjin Hi Tech |
Kweichow Moutai and Tianjin Hi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kweichow Moutai and Tianjin Hi
The main advantage of trading using opposite Kweichow Moutai and Tianjin Hi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kweichow Moutai position performs unexpectedly, Tianjin Hi 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 Tianjin Hi will offset losses from the drop in Tianjin Hi's long position.| Kweichow Moutai vs. Huafa Industrial Co | Kweichow Moutai vs. Xinjiang Baodi Mining | Kweichow Moutai vs. Guangzhou Haozhi Industrial | Kweichow Moutai vs. Hainan Mining Co |
| Tianjin Hi vs. Nanjing Putian Telecommunications | Tianjin Hi vs. Shenzhen Hifuture Electric | Tianjin Hi vs. Shenyang Huitian Thermal | Tianjin Hi vs. Jiangsu Xinning Modern |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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