Correlation Between Zijin Mining and ANGLO ASIAN
Can any of the company-specific risk be diversified away by investing in both Zijin Mining and ANGLO ASIAN 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 ANGLO ASIAN 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 ANGLO ASIAN MINING, you can compare the effects of market volatilities on Zijin Mining and ANGLO ASIAN 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 ANGLO ASIAN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zijin Mining and ANGLO ASIAN.
Diversification Opportunities for Zijin Mining and ANGLO ASIAN
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zijin and ANGLO is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Zijin Mining Group and ANGLO ASIAN MINING in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANGLO ASIAN MINING 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 ANGLO ASIAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANGLO ASIAN MINING has no effect on the direction of Zijin Mining i.e., Zijin Mining and ANGLO ASIAN go up and down completely randomly.
Pair Corralation between Zijin Mining and ANGLO ASIAN
Assuming the 90 days horizon Zijin Mining is expected to generate 2.75 times less return on investment than ANGLO ASIAN. In addition to that, Zijin Mining is 1.29 times more volatile than ANGLO ASIAN MINING. It trades about 0.03 of its total potential returns per unit of risk. ANGLO ASIAN MINING is currently generating about 0.1 per unit of volatility. If you would invest 97.00 in ANGLO ASIAN MINING on November 3, 2024 and sell it today you would earn a total of 33.00 from holding ANGLO ASIAN MINING or generate 34.02% 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. ANGLO ASIAN MINING
Performance |
| Timeline |
| Zijin Mining Group |
| ANGLO ASIAN MINING |
Zijin Mining and ANGLO ASIAN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zijin Mining and ANGLO ASIAN
The main advantage of trading using opposite Zijin Mining and ANGLO ASIAN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zijin Mining position performs unexpectedly, ANGLO ASIAN 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 ANGLO ASIAN will offset losses from the drop in ANGLO ASIAN's long position.| Zijin Mining vs. Cardinal Health | Zijin Mining vs. Waste Management | Zijin Mining vs. Media and Games | Zijin Mining vs. Hochschild Mining plc |
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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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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