Correlation Between Vertiv Holdings and Zijin Mining
Can any of the company-specific risk be diversified away by investing in both Vertiv Holdings 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 Vertiv Holdings and Zijin Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vertiv Holdings Co and Zijin Mining Group, you can compare the effects of market volatilities on Vertiv Holdings 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 Vertiv Holdings with a short position of Zijin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vertiv Holdings and Zijin Mining.
Diversification Opportunities for Vertiv Holdings and Zijin Mining
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Vertiv and Zijin is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Vertiv Holdings Co 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 Vertiv Holdings 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 Vertiv Holdings Co 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 Vertiv Holdings i.e., Vertiv Holdings and Zijin Mining go up and down completely randomly.
Pair Corralation between Vertiv Holdings and Zijin Mining
Considering the 90-day investment horizon Vertiv Holdings Co is expected to under-perform the Zijin Mining. In addition to that, Vertiv Holdings is 1.6 times more volatile than Zijin Mining Group. It trades about -0.06 of its total potential returns per unit of risk. Zijin Mining Group is currently generating about 0.07 per unit of volatility. If you would invest 194.00 in Zijin Mining Group on November 27, 2024 and sell it today you would earn a total of 6.00 from holding Zijin Mining Group or generate 3.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vertiv Holdings Co vs. Zijin Mining Group
Performance |
| Timeline |
| Vertiv Holdings |
| Zijin Mining Group |
Vertiv Holdings and Zijin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vertiv Holdings and Zijin Mining
The main advantage of trading using opposite Vertiv Holdings and Zijin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vertiv Holdings 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.| Vertiv Holdings vs. nVent Electric PLC | Vertiv Holdings vs. Hubbell | Vertiv Holdings vs. Advanced Energy Industries | Vertiv Holdings vs. Energizer Holdings |
| 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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