Correlation Between Zijin Mining and NAKED WINES
Can any of the company-specific risk be diversified away by investing in both Zijin Mining and NAKED WINES 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 NAKED WINES 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 NAKED WINES PLC, you can compare the effects of market volatilities on Zijin Mining and NAKED WINES 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 NAKED WINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zijin Mining and NAKED WINES.
Diversification Opportunities for Zijin Mining and NAKED WINES
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Zijin and NAKED is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Zijin Mining Group and NAKED WINES PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NAKED WINES 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 NAKED WINES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NAKED WINES PLC has no effect on the direction of Zijin Mining i.e., Zijin Mining and NAKED WINES go up and down completely randomly.
Pair Corralation between Zijin Mining and NAKED WINES
Assuming the 90 days horizon Zijin Mining is expected to generate 3.06 times less return on investment than NAKED WINES. But when comparing it to its historical volatility, Zijin Mining Group is 1.92 times less risky than NAKED WINES. It trades about 0.09 of its potential returns per unit of risk. NAKED WINES PLC is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 56.00 in NAKED WINES PLC on November 7, 2024 and sell it today you would earn a total of 7.00 from holding NAKED WINES PLC or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zijin Mining Group vs. NAKED WINES PLC
Performance |
| Timeline |
| Zijin Mining Group |
| NAKED WINES PLC |
Zijin Mining and NAKED WINES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zijin Mining and NAKED WINES
The main advantage of trading using opposite Zijin Mining and NAKED WINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zijin Mining position performs unexpectedly, NAKED WINES 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 NAKED WINES will offset losses from the drop in NAKED WINES's long position.| Zijin Mining vs. BHP Group Limited | Zijin Mining vs. Rio Tinto Group | Zijin Mining vs. Vale SA | Zijin Mining vs. Vale SA |
| NAKED WINES vs. Autohome ADR | NAKED WINES vs. Media and Games | NAKED WINES vs. Haverty Furniture Companies | NAKED WINES vs. CITY OFFICE REIT |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |