Correlation Between Zoje Resources and Western Mining
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By analyzing existing cross correlation between Zoje Resources Investment and Western Mining Co, you can compare the effects of market volatilities on Zoje Resources and Western 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 Zoje Resources with a short position of Western Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zoje Resources and Western Mining.
Diversification Opportunities for Zoje Resources and Western Mining
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zoje and Western is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Zoje Resources Investment and Western Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Mining and Zoje Resources 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 Zoje Resources Investment are associated (or correlated) with Western Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Mining has no effect on the direction of Zoje Resources i.e., Zoje Resources and Western Mining go up and down completely randomly.
Pair Corralation between Zoje Resources and Western Mining
Assuming the 90 days trading horizon Zoje Resources Investment is expected to generate 1.5 times more return on investment than Western Mining. However, Zoje Resources is 1.5 times more volatile than Western Mining Co. It trades about 0.08 of its potential returns per unit of risk. Western Mining Co is currently generating about -0.01 per unit of risk. If you would invest 212.00 in Zoje Resources Investment on September 3, 2024 and sell it today you would earn a total of 68.00 from holding Zoje Resources Investment or generate 32.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zoje Resources Investment vs. Western Mining Co
Performance |
| Timeline |
| Zoje Resources Investment |
| Western Mining |
Zoje Resources and Western Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zoje Resources and Western Mining
The main advantage of trading using opposite Zoje Resources and Western Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zoje Resources position performs unexpectedly, Western 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 Western Mining will offset losses from the drop in Western Mining's long position.| Zoje Resources vs. Cultural Investment Holdings | Zoje Resources vs. Gome Telecom Equipment | Zoje Resources vs. Bus Online Co | Zoje Resources vs. Holitech Technology Co |
| Western Mining vs. Zijin Mining Group | Western Mining vs. Baoshan Iron Steel | Western Mining vs. Hoshine Silicon Ind |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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