Correlation Between Stepan and Zijin Mining
Can any of the company-specific risk be diversified away by investing in both Stepan 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 Stepan and Zijin Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stepan Company and Zijin Mining Group, you can compare the effects of market volatilities on Stepan 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 Stepan with a short position of Zijin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stepan and Zijin Mining.
Diversification Opportunities for Stepan and Zijin Mining
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Stepan and Zijin is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Stepan Company 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 Stepan 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 Stepan Company 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 Stepan i.e., Stepan and Zijin Mining go up and down completely randomly.
Pair Corralation between Stepan and Zijin Mining
Considering the 90-day investment horizon Stepan Company is expected to generate 0.68 times more return on investment than Zijin Mining. However, Stepan Company is 1.48 times less risky than Zijin Mining. It trades about 0.13 of its potential returns per unit of risk. Zijin Mining Group is currently generating about -0.17 per unit of risk. If you would invest 7,252 in Stepan Company on September 2, 2024 and sell it today you would earn a total of 438.00 from holding Stepan Company or generate 6.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stepan Company vs. Zijin Mining Group
Performance |
| Timeline |
| Stepan Company |
| Zijin Mining Group |
Stepan and Zijin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stepan and Zijin Mining
The main advantage of trading using opposite Stepan and Zijin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stepan 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.| Stepan vs. Linde plc Ordinary | Stepan vs. Air Products and | Stepan vs. Aquagold International | Stepan vs. Thrivent High Yield |
| Zijin Mining vs. Torex Gold Resources | Zijin Mining vs. Wesdome Gold Mines | Zijin Mining vs. Northern Star Resources | Zijin Mining vs. Regis Resources |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |