Correlation Between PUBLIC STORAGE and Zijin Mining
Can any of the company-specific risk be diversified away by investing in both PUBLIC STORAGE 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 PUBLIC STORAGE and Zijin Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PUBLIC STORAGE PRFO and Zijin Mining Group, you can compare the effects of market volatilities on PUBLIC STORAGE 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 PUBLIC STORAGE with a short position of Zijin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of PUBLIC STORAGE and Zijin Mining.
Diversification Opportunities for PUBLIC STORAGE and Zijin Mining
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PUBLIC and Zijin is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding PUBLIC STORAGE PRFO 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 PUBLIC STORAGE 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 PUBLIC STORAGE PRFO 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 PUBLIC STORAGE i.e., PUBLIC STORAGE and Zijin Mining go up and down completely randomly.
Pair Corralation between PUBLIC STORAGE and Zijin Mining
Assuming the 90 days trading horizon PUBLIC STORAGE is expected to generate 13.06 times less return on investment than Zijin Mining. But when comparing it to its historical volatility, PUBLIC STORAGE PRFO is 3.3 times less risky than Zijin Mining. It trades about 0.01 of its potential returns per unit of risk. Zijin Mining Group is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 109.00 in Zijin Mining Group on August 31, 2024 and sell it today you would earn a total of 68.00 from holding Zijin Mining Group or generate 62.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.74% |
| Values | Daily Returns |
PUBLIC STORAGE PRFO vs. Zijin Mining Group
Performance |
| Timeline |
| PUBLIC STORAGE PRFO |
| Zijin Mining Group |
PUBLIC STORAGE and Zijin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PUBLIC STORAGE and Zijin Mining
The main advantage of trading using opposite PUBLIC STORAGE and Zijin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PUBLIC STORAGE 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.| PUBLIC STORAGE vs. Lyxor 1 | PUBLIC STORAGE vs. Xtrackers ShortDAX | PUBLIC STORAGE vs. Xtrackers LevDAX | PUBLIC STORAGE vs. Superior Plus Corp |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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