Correlation Between Zijin Mining and Zhejiang Zhengguang
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By analyzing existing cross correlation between Zijin Mining Group and Zhejiang Zhengguang Industrial, you can compare the effects of market volatilities on Zijin Mining and Zhejiang Zhengguang 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 Zhejiang Zhengguang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zijin Mining and Zhejiang Zhengguang.
Diversification Opportunities for Zijin Mining and Zhejiang Zhengguang
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Zijin and Zhejiang is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Zijin Mining Group and Zhejiang Zhengguang Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Zhengguang 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 Zhejiang Zhengguang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Zhengguang has no effect on the direction of Zijin Mining i.e., Zijin Mining and Zhejiang Zhengguang go up and down completely randomly.
Pair Corralation between Zijin Mining and Zhejiang Zhengguang
Assuming the 90 days trading horizon Zijin Mining Group is expected to under-perform the Zhejiang Zhengguang. But the stock apears to be less risky and, when comparing its historical volatility, Zijin Mining Group is 1.39 times less risky than Zhejiang Zhengguang. The stock trades about -0.02 of its potential returns per unit of risk. The Zhejiang Zhengguang Industrial is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 2,737 in Zhejiang Zhengguang Industrial on September 3, 2024 and sell it today you would lose (241.00) from holding Zhejiang Zhengguang Industrial or give up 8.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zijin Mining Group vs. Zhejiang Zhengguang Industrial
Performance |
| Timeline |
| Zijin Mining Group |
| Zhejiang Zhengguang |
Zijin Mining and Zhejiang Zhengguang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zijin Mining and Zhejiang Zhengguang
The main advantage of trading using opposite Zijin Mining and Zhejiang Zhengguang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zijin Mining position performs unexpectedly, Zhejiang Zhengguang 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 Zhejiang Zhengguang will offset losses from the drop in Zhejiang Zhengguang's long position.| Zijin Mining vs. Baoshan Iron Steel | Zijin Mining vs. Rongsheng Petrochemical Co | Zijin Mining vs. Hoshine Silicon Ind |
| Zhejiang Zhengguang vs. Zijin Mining Group | Zhejiang Zhengguang vs. Baoshan Iron Steel | Zhejiang Zhengguang vs. Rongsheng Petrochemical Co | Zhejiang Zhengguang 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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