Correlation Between CSSC Offshore and Zijin Mining
Can any of the company-specific risk be diversified away by investing in both CSSC Offshore and Zijin Mining 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 CSSC Offshore and Zijin Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CSSC Offshore Marine and Zijin Mining Group, you can compare the effects of market volatilities on CSSC Offshore and Zijin Mining 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 CSSC Offshore with a short position of Zijin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSSC Offshore and Zijin Mining.
Diversification Opportunities for CSSC Offshore and Zijin Mining
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between CSSC and Zijin is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding CSSC Offshore Marine and Zijin Mining Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zijin Mining Group and CSSC Offshore 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 CSSC Offshore Marine are associated (or correlated) with Zijin Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zijin Mining Group has no effect on the direction of CSSC Offshore i.e., CSSC Offshore and Zijin Mining go up and down completely randomly.
Pair Corralation between CSSC Offshore and Zijin Mining
Assuming the 90 days trading horizon CSSC Offshore Marine is expected to under-perform the Zijin Mining. But the stock apears to be less risky and, when comparing its historical volatility, CSSC Offshore Marine is 3.66 times less risky than Zijin Mining. The stock trades about -0.28 of its potential returns per unit of risk. The Zijin Mining Group is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 173.00 in Zijin Mining Group on November 6, 2024 and sell it today you would earn a total of 7.00 from holding Zijin Mining Group or generate 4.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CSSC Offshore Marine vs. Zijin Mining Group
Performance |
| Timeline |
| CSSC Offshore Marine |
| Zijin Mining Group |
CSSC Offshore and Zijin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CSSC Offshore and Zijin Mining
The main advantage of trading using opposite CSSC Offshore and Zijin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CSSC Offshore position performs unexpectedly, Zijin Mining 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 Zijin Mining will offset losses from the drop in Zijin Mining's long position.| CSSC Offshore vs. FAST RETAIL ADR | CSSC Offshore vs. Highlight Communications AG | CSSC Offshore vs. SIDETRADE EO 1 | CSSC Offshore vs. TRADELINK ELECTRON |
| Zijin Mining vs. Townsquare Media | Zijin Mining vs. Tsingtao Brewery | Zijin Mining vs. CNVISION MEDIA | Zijin Mining vs. Suntory Beverage Food |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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