Correlation Between Zijin Mining and Derwent London
Can any of the company-specific risk be diversified away by investing in both Zijin Mining and Derwent London 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 Derwent London 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 Derwent London PLC, you can compare the effects of market volatilities on Zijin Mining and Derwent London 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 Derwent London. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zijin Mining and Derwent London.
Diversification Opportunities for Zijin Mining and Derwent London
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Zijin and Derwent is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Zijin Mining Group and Derwent London PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Derwent London PLC 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 Derwent London. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Derwent London PLC has no effect on the direction of Zijin Mining i.e., Zijin Mining and Derwent London go up and down completely randomly.
Pair Corralation between Zijin Mining and Derwent London
Assuming the 90 days horizon Zijin Mining Group is expected to generate 1.7 times more return on investment than Derwent London. However, Zijin Mining is 1.7 times more volatile than Derwent London PLC. It trades about 0.01 of its potential returns per unit of risk. Derwent London PLC is currently generating about -0.03 per unit of risk. If you would invest 182.00 in Zijin Mining Group on September 5, 2024 and sell it today you would lose (5.00) from holding Zijin Mining Group or give up 2.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.22% |
| Values | Daily Returns |
Zijin Mining Group vs. Derwent London PLC
Performance |
| Timeline |
| Zijin Mining Group |
| Derwent London PLC |
Zijin Mining and Derwent London Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zijin Mining and Derwent London
The main advantage of trading using opposite Zijin Mining and Derwent London positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zijin Mining position performs unexpectedly, Derwent London 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 Derwent London will offset losses from the drop in Derwent London's long position.| Zijin Mining vs. BHP Group Limited | Zijin Mining vs. Rio Tinto Group | Zijin Mining vs. ANGLO AMERICAN SPADR |
| Derwent London vs. GameStop Corp | Derwent London vs. ANGLER GAMING PLC | Derwent London vs. Zijin Mining Group | Derwent London vs. TSOGO SUN GAMING |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Positions Ratings 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 | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |