Correlation Between ZIM Integrated and NMI Holdings
Can any of the company-specific risk be diversified away by investing in both ZIM Integrated and NMI Holdings at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining ZIM Integrated and NMI Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ZIM Integrated Shipping and NMI Holdings, you can compare the effects of market volatilities on ZIM Integrated and NMI Holdings 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 ZIM Integrated with a short position of NMI Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZIM Integrated and NMI Holdings.
Diversification Opportunities for ZIM Integrated and NMI Holdings
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ZIM and NMI is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding ZIM Integrated Shipping and NMI Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NMI Holdings and ZIM Integrated 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 ZIM Integrated Shipping are associated (or correlated) with NMI Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NMI Holdings has no effect on the direction of ZIM Integrated i.e., ZIM Integrated and NMI Holdings go up and down completely randomly.
Pair Corralation between ZIM Integrated and NMI Holdings
Assuming the 90 days horizon ZIM Integrated Shipping is expected to generate 2.42 times more return on investment than NMI Holdings. However, ZIM Integrated is 2.42 times more volatile than NMI Holdings. It trades about 0.09 of its potential returns per unit of risk. NMI Holdings is currently generating about 0.11 per unit of risk. If you would invest 1,969 in ZIM Integrated Shipping on September 1, 2024 and sell it today you would earn a total of 168.00 from holding ZIM Integrated Shipping or generate 8.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
ZIM Integrated Shipping vs. NMI Holdings
Performance |
| Timeline |
| ZIM Integrated Shipping |
| NMI Holdings |
ZIM Integrated and NMI Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZIM Integrated and NMI Holdings
The main advantage of trading using opposite ZIM Integrated and NMI Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZIM Integrated position performs unexpectedly, NMI Holdings 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 NMI Holdings will offset losses from the drop in NMI Holdings' long position.| ZIM Integrated vs. CENTURIA OFFICE REIT | ZIM Integrated vs. GREENX METALS LTD | ZIM Integrated vs. ALBIS LEASING AG | ZIM Integrated vs. Global Ship Lease |
| NMI Holdings vs. KIMBALL ELECTRONICS | NMI Holdings vs. UET United Electronic | NMI Holdings vs. BYD ELECTRONIC | NMI Holdings vs. Benchmark Electronics |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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