Correlation Between TIMES CHINA and Zijin Mining
Can any of the company-specific risk be diversified away by investing in both TIMES CHINA 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 TIMES CHINA and Zijin Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TIMES CHINA HLDGS and Zijin Mining Group, you can compare the effects of market volatilities on TIMES CHINA 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 TIMES CHINA with a short position of Zijin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of TIMES CHINA and Zijin Mining.
Diversification Opportunities for TIMES CHINA and Zijin Mining
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between TIMES and Zijin is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding TIMES CHINA HLDGS 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 TIMES CHINA 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 TIMES CHINA HLDGS 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 TIMES CHINA i.e., TIMES CHINA and Zijin Mining go up and down completely randomly.
Pair Corralation between TIMES CHINA and Zijin Mining
Assuming the 90 days horizon TIMES CHINA HLDGS is expected to generate 4.54 times more return on investment than Zijin Mining. However, TIMES CHINA is 4.54 times more volatile than Zijin Mining Group. It trades about 0.11 of its potential returns per unit of risk. Zijin Mining Group is currently generating about 0.03 per unit of risk. If you would invest 1.55 in TIMES CHINA HLDGS on September 14, 2024 and sell it today you would earn a total of 1.70 from holding TIMES CHINA HLDGS or generate 109.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TIMES CHINA HLDGS vs. Zijin Mining Group
Performance |
| Timeline |
| TIMES CHINA HLDGS |
| Zijin Mining Group |
TIMES CHINA and Zijin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TIMES CHINA and Zijin Mining
The main advantage of trading using opposite TIMES CHINA and Zijin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TIMES CHINA 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.| TIMES CHINA vs. Zijin Mining Group | TIMES CHINA vs. MINCO SILVER | TIMES CHINA vs. Harmony Gold Mining | TIMES CHINA vs. Coeur Mining |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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