Correlation Between CVB Financial and Zijin Mining
Can any of the company-specific risk be diversified away by investing in both CVB Financial and Zijin Mining 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 CVB Financial and Zijin Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CVB Financial Corp and Zijin Mining Group, you can compare the effects of market volatilities on CVB Financial 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 CVB Financial with a short position of Zijin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVB Financial and Zijin Mining.
Diversification Opportunities for CVB Financial and Zijin Mining
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CVB and Zijin is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding CVB Financial Corp 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 CVB Financial 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 CVB Financial Corp 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 CVB Financial i.e., CVB Financial and Zijin Mining go up and down completely randomly.
Pair Corralation between CVB Financial and Zijin Mining
Assuming the 90 days horizon CVB Financial Corp is expected to under-perform the Zijin Mining. But the stock apears to be less risky and, when comparing its historical volatility, CVB Financial Corp is 1.43 times less risky than Zijin Mining. The stock trades about -0.09 of its potential returns per unit of risk. The Zijin Mining Group is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 176.00 in Zijin Mining Group on November 4, 2024 and sell it today you would earn a total of 8.00 from holding Zijin Mining Group or generate 4.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
CVB Financial Corp vs. Zijin Mining Group
Performance |
| Timeline |
| CVB Financial Corp |
| Zijin Mining Group |
CVB Financial and Zijin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CVB Financial and Zijin Mining
The main advantage of trading using opposite CVB Financial and Zijin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVB Financial 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.| CVB Financial vs. Indutrade AB | CVB Financial vs. FAST RETAIL ADR | CVB Financial vs. SALESFORCE INC CDR | CVB Financial vs. Tradegate AG Wertpapierhandelsbank |
| Zijin Mining vs. PREMIER FOODS | Zijin Mining vs. LIFEWAY FOODS | Zijin Mining vs. Scandinavian Tobacco Group | Zijin Mining vs. GALENA MINING LTD |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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