Correlation Between Zijin Mining and Digital China
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By analyzing existing cross correlation between Zijin Mining Group and Digital China Information, you can compare the effects of market volatilities on Zijin Mining and Digital China 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 Zijin Mining with a short position of Digital China. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zijin Mining and Digital China.
Diversification Opportunities for Zijin Mining and Digital China
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Zijin and Digital is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Zijin Mining Group and Digital China Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Digital China Information and Zijin Mining 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 Zijin Mining Group are associated (or correlated) with Digital China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Digital China Information has no effect on the direction of Zijin Mining i.e., Zijin Mining and Digital China go up and down completely randomly.
Pair Corralation between Zijin Mining and Digital China
Assuming the 90 days trading horizon Zijin Mining is expected to generate 1.74 times less return on investment than Digital China. But when comparing it to its historical volatility, Zijin Mining Group is 1.33 times less risky than Digital China. It trades about 0.18 of its potential returns per unit of risk. Digital China Information is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 1,005 in Digital China Information on November 6, 2024 and sell it today you would earn a total of 86.00 from holding Digital China Information or generate 8.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zijin Mining Group vs. Digital China Information
Performance |
| Timeline |
| Zijin Mining Group |
| Digital China Information |
Zijin Mining and Digital China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zijin Mining and Digital China
The main advantage of trading using opposite Zijin Mining and Digital China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zijin Mining position performs unexpectedly, Digital China 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 Digital China will offset losses from the drop in Digital China's long position.| Zijin Mining vs. Wanhua Chemical Group | Zijin Mining vs. Baoshan Iron Steel | Zijin Mining vs. Shandong Gold Mining | Zijin Mining vs. Rongsheng Petrochemical Co |
| Digital China vs. GuoChuang Software Co | Digital China vs. Guangdong Jinma Entertainment | Digital China vs. Omnijoi Media Corp | Digital China vs. Simei Media 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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