Correlation Between Newmont and ZIJIN MINH
Can any of the company-specific risk be diversified away by investing in both Newmont and ZIJIN MINH 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 Newmont and ZIJIN MINH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Newmont and ZIJIN MINH UNSPADR20, you can compare the effects of market volatilities on Newmont and ZIJIN MINH 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 Newmont with a short position of ZIJIN MINH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newmont and ZIJIN MINH.
Diversification Opportunities for Newmont and ZIJIN MINH
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Newmont and ZIJIN is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Newmont and ZIJIN MINH UNSPADR20 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZIJIN MINH UNSPADR20 and Newmont 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 Newmont are associated (or correlated) with ZIJIN MINH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZIJIN MINH UNSPADR20 has no effect on the direction of Newmont i.e., Newmont and ZIJIN MINH go up and down completely randomly.
Pair Corralation between Newmont and ZIJIN MINH
Assuming the 90 days horizon Newmont is expected to under-perform the ZIJIN MINH. But the stock apears to be less risky and, when comparing its historical volatility, Newmont is 1.04 times less risky than ZIJIN MINH. The stock trades about -0.11 of its potential returns per unit of risk. The ZIJIN MINH UNSPADR20 is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 3,600 in ZIJIN MINH UNSPADR20 on October 13, 2024 and sell it today you would lose (20.00) from holding ZIJIN MINH UNSPADR20 or give up 0.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Newmont vs. ZIJIN MINH UNSPADR20
Performance |
| Timeline |
| Newmont |
| ZIJIN MINH UNSPADR20 |
Newmont and ZIJIN MINH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Newmont and ZIJIN MINH
The main advantage of trading using opposite Newmont and ZIJIN MINH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Newmont position performs unexpectedly, ZIJIN MINH 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 MINH will offset losses from the drop in ZIJIN MINH's long position.| Newmont vs. LOANDEPOT INC A | Newmont vs. Grupo Carso SAB | Newmont vs. NH HOTEL GROUP | Newmont vs. United Rentals |
| ZIJIN MINH vs. Wheaton Precious Metals | ZIJIN MINH vs. Superior Plus Corp | ZIJIN MINH vs. NMI Holdings | ZIJIN MINH 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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