Correlation Between Zijin Mining and Ramsay Health
Can any of the company-specific risk be diversified away by investing in both Zijin Mining and Ramsay Health 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 Ramsay Health 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 Ramsay Health Care, you can compare the effects of market volatilities on Zijin Mining and Ramsay Health 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 Ramsay Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zijin Mining and Ramsay Health.
Diversification Opportunities for Zijin Mining and Ramsay Health
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zijin and Ramsay is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Zijin Mining Group and Ramsay Health Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ramsay Health Care 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 Ramsay Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ramsay Health Care has no effect on the direction of Zijin Mining i.e., Zijin Mining and Ramsay Health go up and down completely randomly.
Pair Corralation between Zijin Mining and Ramsay Health
Assuming the 90 days horizon Zijin Mining Group is expected to generate 2.7 times more return on investment than Ramsay Health. However, Zijin Mining is 2.7 times more volatile than Ramsay Health Care. It trades about 0.04 of its potential returns per unit of risk. Ramsay Health Care is currently generating about 0.02 per unit of risk. If you would invest 169.00 in Zijin Mining Group on September 3, 2024 and sell it today you would earn a total of 8.00 from holding Zijin Mining Group or generate 4.73% 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. Ramsay Health Care
Performance |
| Timeline |
| Zijin Mining Group |
| Ramsay Health Care |
Zijin Mining and Ramsay Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zijin Mining and Ramsay Health
The main advantage of trading using opposite Zijin Mining and Ramsay Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zijin Mining position performs unexpectedly, Ramsay Health 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 Ramsay Health will offset losses from the drop in Ramsay Health's long position.| Zijin Mining vs. ARISTOCRAT LEISURE | Zijin Mining vs. EAT WELL INVESTMENT | Zijin Mining vs. ePlay Digital | Zijin Mining vs. PennantPark Investment |
| Ramsay Health vs. Superior Plus Corp | Ramsay Health vs. NMI Holdings | Ramsay Health vs. Origin Agritech | Ramsay Health vs. SIVERS SEMICONDUCTORS AB |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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