Correlation Between Zijin Mining and Performance Food
Can any of the company-specific risk be diversified away by investing in both Zijin Mining and Performance Food 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 Performance Food 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 Performance Food Group, you can compare the effects of market volatilities on Zijin Mining and Performance Food 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 Performance Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zijin Mining and Performance Food.
Diversification Opportunities for Zijin Mining and Performance Food
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Zijin and Performance is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Zijin Mining Group and Performance Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Performance Food 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 Performance Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Performance Food has no effect on the direction of Zijin Mining i.e., Zijin Mining and Performance Food go up and down completely randomly.
Pair Corralation between Zijin Mining and Performance Food
Assuming the 90 days horizon Zijin Mining Group is expected to generate 2.2 times more return on investment than Performance Food. However, Zijin Mining is 2.2 times more volatile than Performance Food Group. It trades about 0.07 of its potential returns per unit of risk. Performance Food Group is currently generating about 0.08 per unit of risk. If you would invest 121.00 in Zijin Mining Group on August 25, 2024 and sell it today you would earn a total of 62.00 from holding Zijin Mining Group or generate 51.24% 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. Performance Food Group
Performance |
| Timeline |
| Zijin Mining Group |
| Performance Food |
Zijin Mining and Performance Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zijin Mining and Performance Food
The main advantage of trading using opposite Zijin Mining and Performance Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zijin Mining position performs unexpectedly, Performance Food 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 Performance Food will offset losses from the drop in Performance Food's long position.| Zijin Mining vs. BHP Group Limited | Zijin Mining vs. Superior Plus Corp | Zijin Mining vs. NMI Holdings | Zijin Mining vs. Origin Agritech |
| Performance Food vs. Apple Inc | Performance Food vs. Apple Inc | Performance Food vs. Apple Inc | Performance Food vs. Apple Inc |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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