Correlation Between Kweichow Moutai and Eastroc Beverage
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By analyzing existing cross correlation between Kweichow Moutai Co and Eastroc Beverage Group, you can compare the effects of market volatilities on Kweichow Moutai and Eastroc Beverage 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 Eastroc Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kweichow Moutai and Eastroc Beverage.
Diversification Opportunities for Kweichow Moutai and Eastroc Beverage
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kweichow and Eastroc is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Kweichow Moutai Co and Eastroc Beverage Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastroc Beverage 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 Eastroc Beverage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastroc Beverage has no effect on the direction of Kweichow Moutai i.e., Kweichow Moutai and Eastroc Beverage go up and down completely randomly.
Pair Corralation between Kweichow Moutai and Eastroc Beverage
Assuming the 90 days trading horizon Kweichow Moutai is expected to generate 1.62 times less return on investment than Eastroc Beverage. In addition to that, Kweichow Moutai is 1.1 times more volatile than Eastroc Beverage Group. It trades about 0.15 of its total potential returns per unit of risk. Eastroc Beverage Group is currently generating about 0.27 per unit of volatility. If you would invest 17,211 in Eastroc Beverage Group on September 14, 2024 and sell it today you would earn a total of 7,426 from holding Eastroc Beverage Group or generate 43.15% 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. Eastroc Beverage Group
Performance |
Timeline |
Kweichow Moutai |
Eastroc Beverage |
Kweichow Moutai and Eastroc Beverage Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Kweichow Moutai and Eastroc Beverage
The main advantage of trading using opposite Kweichow Moutai and Eastroc Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kweichow Moutai position performs unexpectedly, Eastroc Beverage 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 Eastroc Beverage will offset losses from the drop in Eastroc Beverage's long position.Kweichow Moutai vs. China Life Insurance | Kweichow Moutai vs. Cinda Securities Co | Kweichow Moutai vs. Piotech Inc A | Kweichow Moutai vs. Dongxing Sec Co |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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