Correlation Between Kweichow Moutai and China Citic
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By analyzing existing cross correlation between Kweichow Moutai Co and China Citic Bank, you can compare the effects of market volatilities on Kweichow Moutai and China Citic 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 China Citic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kweichow Moutai and China Citic.
Diversification Opportunities for Kweichow Moutai and China Citic
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kweichow and China is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Kweichow Moutai Co and China Citic Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Citic Bank 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 China Citic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Citic Bank has no effect on the direction of Kweichow Moutai i.e., Kweichow Moutai and China Citic go up and down completely randomly.
Pair Corralation between Kweichow Moutai and China Citic
Assuming the 90 days trading horizon Kweichow Moutai Co is expected to generate 1.16 times more return on investment than China Citic. However, Kweichow Moutai is 1.16 times more volatile than China Citic Bank. It trades about 0.03 of its potential returns per unit of risk. China Citic Bank is currently generating about 0.02 per unit of risk. If you would invest 144,038 in Kweichow Moutai Co on September 27, 2024 and sell it today you would earn a total of 8,962 from holding Kweichow Moutai Co or generate 6.22% 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. China Citic Bank
Performance |
| Timeline |
| Kweichow Moutai |
| China Citic Bank |
Kweichow Moutai and China Citic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kweichow Moutai and China Citic
The main advantage of trading using opposite Kweichow Moutai and China Citic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kweichow Moutai position performs unexpectedly, China Citic 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 China Citic will offset losses from the drop in China Citic's long position.| Kweichow Moutai vs. PetroChina Co Ltd | Kweichow Moutai vs. China Mobile Limited | Kweichow Moutai vs. CNOOC Limited | Kweichow Moutai vs. Ping An Insurance |
| China Citic vs. Kweichow Moutai Co | China Citic vs. Contemporary Amperex Technology | China Citic vs. G bits Network Technology | China Citic 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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