Correlation Between Kweichow Moutai and Shanghai Lingyun
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By analyzing existing cross correlation between Kweichow Moutai Co and Shanghai Lingyun Industries, you can compare the effects of market volatilities on Kweichow Moutai and Shanghai Lingyun 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 Shanghai Lingyun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kweichow Moutai and Shanghai Lingyun.
Diversification Opportunities for Kweichow Moutai and Shanghai Lingyun
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kweichow and Shanghai is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Kweichow Moutai Co and Shanghai Lingyun Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Lingyun Ind 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 Shanghai Lingyun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Lingyun Ind has no effect on the direction of Kweichow Moutai i.e., Kweichow Moutai and Shanghai Lingyun go up and down completely randomly.
Pair Corralation between Kweichow Moutai and Shanghai Lingyun
Assuming the 90 days trading horizon Kweichow Moutai Co is expected to under-perform the Shanghai Lingyun. But the stock apears to be less risky and, when comparing its historical volatility, Kweichow Moutai Co is 2.45 times less risky than Shanghai Lingyun. The stock trades about -0.17 of its potential returns per unit of risk. The Shanghai Lingyun Industries is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 35.00 in Shanghai Lingyun Industries on August 30, 2024 and sell it today you would earn a total of 3.00 from holding Shanghai Lingyun Industries or generate 8.57% 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. Shanghai Lingyun Industries
Performance |
| Timeline |
| Kweichow Moutai |
| Shanghai Lingyun Ind |
Kweichow Moutai and Shanghai Lingyun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kweichow Moutai and Shanghai Lingyun
The main advantage of trading using opposite Kweichow Moutai and Shanghai Lingyun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kweichow Moutai position performs unexpectedly, Shanghai Lingyun 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 Shanghai Lingyun will offset losses from the drop in Shanghai Lingyun's long position.| Kweichow Moutai vs. Nanjing Medlander Medical | Kweichow Moutai vs. Changjiang Jinggong Steel | Kweichow Moutai vs. City Development Environment | Kweichow Moutai vs. Double Medical Technology |
| Shanghai Lingyun vs. Sinosteel Engineering and | Shanghai Lingyun vs. Jiangxi JDL Environmental | Shanghai Lingyun vs. Guangdong Liantai Environmental | Shanghai Lingyun vs. Tianjin Capital Environmental |
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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