Correlation Between Zijin Mining and Sabra Health
Can any of the company-specific risk be diversified away by investing in both Zijin Mining and Sabra 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 Sabra 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 Sabra Health Care, you can compare the effects of market volatilities on Zijin Mining and Sabra 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 Sabra Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zijin Mining and Sabra Health.
Diversification Opportunities for Zijin Mining and Sabra Health
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Zijin and Sabra is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Zijin Mining Group and Sabra Health Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sabra 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 Sabra Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sabra Health Care has no effect on the direction of Zijin Mining i.e., Zijin Mining and Sabra Health go up and down completely randomly.
Pair Corralation between Zijin Mining and Sabra Health
Assuming the 90 days horizon Zijin Mining Group is expected to under-perform the Sabra Health. In addition to that, Zijin Mining is 1.74 times more volatile than Sabra Health Care. It trades about -0.11 of its total potential returns per unit of risk. Sabra Health Care is currently generating about 0.09 per unit of volatility. If you would invest 1,685 in Sabra Health Care on August 24, 2024 and sell it today you would earn a total of 64.00 from holding Sabra Health Care or generate 3.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zijin Mining Group vs. Sabra Health Care
Performance |
| Timeline |
| Zijin Mining Group |
| Sabra Health Care |
Zijin Mining and Sabra Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zijin Mining and Sabra Health
The main advantage of trading using opposite Zijin Mining and Sabra Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zijin Mining position performs unexpectedly, Sabra 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 Sabra Health will offset losses from the drop in Sabra Health'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 |
| Sabra Health vs. REINET INVESTMENTS SCA | Sabra Health vs. EAT WELL INVESTMENT | Sabra Health vs. Genco Shipping Trading | Sabra Health vs. ECHO INVESTMENT ZY |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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