Correlation Between Kweichow Moutai and China Building
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By analyzing existing cross correlation between Kweichow Moutai Co and China Building Material, you can compare the effects of market volatilities on Kweichow Moutai and China Building 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 Building. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kweichow Moutai and China Building.
Diversification Opportunities for Kweichow Moutai and China Building
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Kweichow and China is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Kweichow Moutai Co and China Building Material in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Building Material 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 Building. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Building Material has no effect on the direction of Kweichow Moutai i.e., Kweichow Moutai and China Building go up and down completely randomly.
Pair Corralation between Kweichow Moutai and China Building
Assuming the 90 days trading horizon Kweichow Moutai Co is expected to generate 0.6 times more return on investment than China Building. However, Kweichow Moutai Co is 1.68 times less risky than China Building. It trades about -0.28 of its potential returns per unit of risk. China Building Material is currently generating about -0.25 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 | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kweichow Moutai Co vs. China Building Material
Performance |
| Timeline |
| Kweichow Moutai |
| China Building Material |
Kweichow Moutai and China Building Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kweichow Moutai and China Building
The main advantage of trading using opposite Kweichow Moutai and China Building positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kweichow Moutai position performs unexpectedly, China Building 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 Building will offset losses from the drop in China Building'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 |
| China Building vs. Kweichow Moutai Co | China Building vs. Contemporary Amperex Technology | China Building vs. Beijing Roborock Technology | China Building 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 Stocks Directory module to find actively traded stocks across global markets.
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