Correlation Between North Huajin and Zijin Mining
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By analyzing existing cross correlation between North Huajin Chemical and Zijin Mining Group, you can compare the effects of market volatilities on North Huajin and Zijin Mining 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 North Huajin with a short position of Zijin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of North Huajin and Zijin Mining.
Diversification Opportunities for North Huajin and Zijin Mining
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between North and Zijin is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding North Huajin Chemical and Zijin Mining Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zijin Mining Group and North Huajin 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 North Huajin Chemical are associated (or correlated) with Zijin Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zijin Mining Group has no effect on the direction of North Huajin i.e., North Huajin and Zijin Mining go up and down completely randomly.
Pair Corralation between North Huajin and Zijin Mining
Assuming the 90 days trading horizon North Huajin Chemical is expected to generate 1.97 times more return on investment than Zijin Mining. However, North Huajin is 1.97 times more volatile than Zijin Mining Group. It trades about -0.03 of its potential returns per unit of risk. Zijin Mining Group is currently generating about -0.25 per unit of risk. If you would invest 561.00 in North Huajin Chemical on August 28, 2024 and sell it today you would lose (21.00) from holding North Huajin Chemical or give up 3.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
North Huajin Chemical vs. Zijin Mining Group
Performance |
| Timeline |
| North Huajin Chemical |
| Zijin Mining Group |
North Huajin and Zijin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with North Huajin and Zijin Mining
The main advantage of trading using opposite North Huajin and Zijin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if North Huajin position performs unexpectedly, Zijin Mining 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 Zijin Mining will offset losses from the drop in Zijin Mining's long position.| North Huajin vs. Zijin Mining Group | North Huajin vs. Wanhua Chemical Group | North Huajin vs. Baoshan Iron Steel | North Huajin vs. Shandong Gold Mining |
| Zijin Mining vs. Wanhua Chemical Group | Zijin Mining vs. Shandong Gold Mining | Zijin Mining vs. Rongsheng Petrochemical Co | Zijin Mining vs. Inner Mongolia BaoTou |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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