Correlation Between ZIJIN MINH and Gold Road
Can any of the company-specific risk be diversified away by investing in both ZIJIN MINH and Gold Road 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 MINH and Gold Road into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ZIJIN MINH UNSPADR20 and Gold Road Resources, you can compare the effects of market volatilities on ZIJIN MINH and Gold Road 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 MINH with a short position of Gold Road. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZIJIN MINH and Gold Road.
Diversification Opportunities for ZIJIN MINH and Gold Road
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ZIJIN and Gold is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding ZIJIN MINH UNSPADR20 and Gold Road Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold Road Resources and ZIJIN MINH 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 MINH UNSPADR20 are associated (or correlated) with Gold Road. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold Road Resources has no effect on the direction of ZIJIN MINH i.e., ZIJIN MINH and Gold Road go up and down completely randomly.
Pair Corralation between ZIJIN MINH and Gold Road
Assuming the 90 days trading horizon ZIJIN MINH UNSPADR20 is expected to generate 0.96 times more return on investment than Gold Road. However, ZIJIN MINH UNSPADR20 is 1.04 times less risky than Gold Road. It trades about 0.05 of its potential returns per unit of risk. Gold Road Resources is currently generating about 0.02 per unit of risk. If you would invest 2,364 in ZIJIN MINH UNSPADR20 on September 4, 2024 and sell it today you would earn a total of 1,596 from holding ZIJIN MINH UNSPADR20 or generate 67.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
ZIJIN MINH UNSPADR20 vs. Gold Road Resources
Performance |
| Timeline |
| ZIJIN MINH UNSPADR20 |
| Gold Road Resources |
ZIJIN MINH and Gold Road Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZIJIN MINH and Gold Road
The main advantage of trading using opposite ZIJIN MINH and Gold Road positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZIJIN MINH position performs unexpectedly, Gold Road 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 Gold Road will offset losses from the drop in Gold Road's long position.| ZIJIN MINH vs. Barrick Gold | ZIJIN MINH vs. Superior Plus Corp | ZIJIN MINH vs. NMI Holdings | ZIJIN MINH vs. Origin Agritech |
| Gold Road vs. ZIJIN MINH UNSPADR20 | Gold Road vs. Barrick Gold | Gold Road vs. Superior Plus Corp | Gold Road vs. NMI Holdings |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |