Correlation Between Chemours and Zijin Mining
Can any of the company-specific risk be diversified away by investing in both Chemours 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 Chemours and Zijin Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chemours Co and Zijin Mining Group, you can compare the effects of market volatilities on Chemours 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 Chemours with a short position of Zijin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chemours and Zijin Mining.
Diversification Opportunities for Chemours and Zijin Mining
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Chemours and Zijin is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Chemours Co 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 Chemours 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 Chemours Co 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 Chemours i.e., Chemours and Zijin Mining go up and down completely randomly.
Pair Corralation between Chemours and Zijin Mining
Allowing for the 90-day total investment horizon Chemours is expected to generate 28.0 times less return on investment than Zijin Mining. But when comparing it to its historical volatility, Chemours Co is 1.36 times less risky than Zijin Mining. It trades about 0.0 of its potential returns per unit of risk. Zijin Mining Group is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 111.00 in Zijin Mining Group on August 31, 2024 and sell it today you would earn a total of 72.00 from holding Zijin Mining Group or generate 64.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 88.32% |
| Values | Daily Returns |
Chemours Co vs. Zijin Mining Group
Performance |
| Timeline |
| Chemours |
| Zijin Mining Group |
Chemours and Zijin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chemours and Zijin Mining
The main advantage of trading using opposite Chemours and Zijin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chemours 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.| Chemours vs. International Flavors Fragrances | Chemours vs. Air Products and | Chemours vs. PPG Industries | Chemours vs. Linde plc Ordinary |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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