Correlation Between Kweichow Moutai and Changchun BCHT
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By analyzing existing cross correlation between Kweichow Moutai Co and Changchun BCHT Biotechnology, you can compare the effects of market volatilities on Kweichow Moutai and Changchun BCHT 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 Changchun BCHT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kweichow Moutai and Changchun BCHT.
Diversification Opportunities for Kweichow Moutai and Changchun BCHT
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kweichow and Changchun is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Kweichow Moutai Co and Changchun BCHT Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changchun BCHT Biote 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 Changchun BCHT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changchun BCHT Biote has no effect on the direction of Kweichow Moutai i.e., Kweichow Moutai and Changchun BCHT go up and down completely randomly.
Pair Corralation between Kweichow Moutai and Changchun BCHT
Assuming the 90 days trading horizon Kweichow Moutai Co is expected to generate 0.53 times more return on investment than Changchun BCHT. However, Kweichow Moutai Co is 1.89 times less risky than Changchun BCHT. It trades about -0.22 of its potential returns per unit of risk. Changchun BCHT Biotechnology is currently generating about -0.3 per unit of risk. If you would invest 152,713 in Kweichow Moutai Co on October 20, 2024 and sell it today you would lose (7,238) from holding Kweichow Moutai Co or give up 4.74% 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. Changchun BCHT Biotechnology
Performance |
| Timeline |
| Kweichow Moutai |
| Changchun BCHT Biote |
Kweichow Moutai and Changchun BCHT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kweichow Moutai and Changchun BCHT
The main advantage of trading using opposite Kweichow Moutai and Changchun BCHT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kweichow Moutai position performs unexpectedly, Changchun BCHT 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 Changchun BCHT will offset losses from the drop in Changchun BCHT's long position.| Kweichow Moutai vs. China Publishing Media | Kweichow Moutai vs. Haima Automobile Group | Kweichow Moutai vs. Jiangsu Xinri E Vehicle | Kweichow Moutai vs. Jiangsu Phoenix Publishing |
| Changchun BCHT vs. CITIC Metal Co | Changchun BCHT vs. Omnijoi Media Corp | Changchun BCHT vs. Zhejiang Yongjin Metal | Changchun BCHT vs. Jiaozuo Wanfang Aluminum |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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