Correlation Between Sichuan Tianqi and Zijin Mining
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By analyzing existing cross correlation between Sichuan Tianqi Lithium and Zijin Mining Group, you can compare the effects of market volatilities on Sichuan Tianqi 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 Sichuan Tianqi with a short position of Zijin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sichuan Tianqi and Zijin Mining.
Diversification Opportunities for Sichuan Tianqi and Zijin Mining
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Sichuan and Zijin is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Sichuan Tianqi Lithium 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 Sichuan Tianqi 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 Sichuan Tianqi Lithium 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 Sichuan Tianqi i.e., Sichuan Tianqi and Zijin Mining go up and down completely randomly.
Pair Corralation between Sichuan Tianqi and Zijin Mining
Assuming the 90 days trading horizon Sichuan Tianqi Lithium is expected to under-perform the Zijin Mining. In addition to that, Sichuan Tianqi is 1.34 times more volatile than Zijin Mining Group. It trades about -0.04 of its total potential returns per unit of risk. Zijin Mining Group is currently generating about 0.06 per unit of volatility. If you would invest 973.00 in Zijin Mining Group on September 13, 2024 and sell it today you would earn a total of 639.00 from holding Zijin Mining Group or generate 65.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Sichuan Tianqi Lithium vs. Zijin Mining Group
Performance |
| Timeline |
| Sichuan Tianqi Lithium |
| Zijin Mining Group |
Sichuan Tianqi and Zijin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sichuan Tianqi and Zijin Mining
The main advantage of trading using opposite Sichuan Tianqi and Zijin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sichuan Tianqi 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.| Sichuan Tianqi vs. Keda Clean Energy | Sichuan Tianqi vs. Servyou Software Group | Sichuan Tianqi vs. Zoje Resources Investment | Sichuan Tianqi vs. China Asset Management |
| Zijin Mining vs. Wanhua Chemical Group | Zijin Mining vs. Baoshan Iron Steel | Zijin Mining vs. Shandong Gold Mining | Zijin Mining vs. Rongsheng Petrochemical 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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