Correlation Between Renxin New and Zijin Mining
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By analyzing existing cross correlation between Renxin New Material and Zijin Mining Group, you can compare the effects of market volatilities on Renxin New 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 Renxin New with a short position of Zijin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Renxin New and Zijin Mining.
Diversification Opportunities for Renxin New and Zijin Mining
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Renxin and Zijin is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Renxin New Material 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 Renxin New 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 Renxin New Material 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 Renxin New i.e., Renxin New and Zijin Mining go up and down completely randomly.
Pair Corralation between Renxin New and Zijin Mining
Assuming the 90 days trading horizon Renxin New Material is expected to generate 1.44 times more return on investment than Zijin Mining. However, Renxin New is 1.44 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 1,202 in Renxin New Material on August 28, 2024 and sell it today you would lose (29.00) from holding Renxin New Material or give up 2.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Renxin New Material vs. Zijin Mining Group
Performance |
| Timeline |
| Renxin New Material |
| Zijin Mining Group |
Renxin New and Zijin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Renxin New and Zijin Mining
The main advantage of trading using opposite Renxin New and Zijin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Renxin New 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.| Renxin New vs. Zijin Mining Group | Renxin New vs. Wanhua Chemical Group | Renxin New vs. Baoshan Iron Steel | Renxin New 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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