Correlation Between Kweichow Moutai and Guobo Electronics
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By analyzing existing cross correlation between Kweichow Moutai Co and Guobo Electronics Co, you can compare the effects of market volatilities on Kweichow Moutai and Guobo Electronics 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 Guobo Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kweichow Moutai and Guobo Electronics.
Diversification Opportunities for Kweichow Moutai and Guobo Electronics
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kweichow and Guobo is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Kweichow Moutai Co and Guobo Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guobo Electronics 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 Guobo Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guobo Electronics has no effect on the direction of Kweichow Moutai i.e., Kweichow Moutai and Guobo Electronics go up and down completely randomly.
Pair Corralation between Kweichow Moutai and Guobo Electronics
Assuming the 90 days trading horizon Kweichow Moutai Co is expected to under-perform the Guobo Electronics. But the stock apears to be less risky and, when comparing its historical volatility, Kweichow Moutai Co is 1.81 times less risky than Guobo Electronics. The stock trades about -0.03 of its potential returns per unit of risk. The Guobo Electronics Co is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 6,306 in Guobo Electronics Co on October 16, 2024 and sell it today you would lose (1,832) from holding Guobo Electronics Co or give up 29.05% 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. Guobo Electronics Co
Performance |
| Timeline |
| Kweichow Moutai |
| Guobo Electronics |
Kweichow Moutai and Guobo Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kweichow Moutai and Guobo Electronics
The main advantage of trading using opposite Kweichow Moutai and Guobo Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kweichow Moutai position performs unexpectedly, Guobo Electronics 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 Guobo Electronics will offset losses from the drop in Guobo Electronics' long position.| Kweichow Moutai vs. Beijing Kingsoft Office | Kweichow Moutai vs. Guangzhou Haige Communications | Kweichow Moutai vs. Dynagreen Environmental Protection | Kweichow Moutai vs. Songz Automobile Air |
| Guobo Electronics vs. Yankershop Food Co | Guobo Electronics vs. Jiangnan Mould Plastic | Guobo Electronics vs. Xinjiang Tianrun Dairy | Guobo Electronics vs. Great Sun Foods Co |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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