Correlation Between Zijin Mining and Aya Gold
Can any of the company-specific risk be diversified away by investing in both Zijin Mining and Aya Gold 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 Zijin Mining and Aya Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zijin Mining Group and Aya Gold Silver, you can compare the effects of market volatilities on Zijin Mining and Aya Gold 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 Aya Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zijin Mining and Aya Gold.
Diversification Opportunities for Zijin Mining and Aya Gold
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zijin and Aya is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Zijin Mining Group and Aya Gold Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aya Gold Silver 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 Aya Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aya Gold Silver has no effect on the direction of Zijin Mining i.e., Zijin Mining and Aya Gold go up and down completely randomly.
Pair Corralation between Zijin Mining and Aya Gold
Assuming the 90 days horizon Zijin Mining Group is expected to generate 0.67 times more return on investment than Aya Gold. However, Zijin Mining Group is 1.5 times less risky than Aya Gold. It trades about 0.06 of its potential returns per unit of risk. Aya Gold Silver is currently generating about -0.04 per unit of risk. If you would invest 171.00 in Zijin Mining Group on November 1, 2024 and sell it today you would earn a total of 4.00 from holding Zijin Mining Group or generate 2.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zijin Mining Group vs. Aya Gold Silver
Performance |
| Timeline |
| Zijin Mining Group |
| Aya Gold Silver |
Zijin Mining and Aya Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zijin Mining and Aya Gold
The main advantage of trading using opposite Zijin Mining and Aya Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zijin Mining position performs unexpectedly, Aya Gold 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 Aya Gold will offset losses from the drop in Aya Gold's long position.| Zijin Mining vs. Compagnie Plastic Omnium | Zijin Mining vs. Summit Materials | Zijin Mining vs. SIERRA METALS | Zijin Mining vs. Osisko Metals |
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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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