Correlation Between Wheaton Precious and Zhaojin Mining
Can any of the company-specific risk be diversified away by investing in both Wheaton Precious and Zhaojin 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 Wheaton Precious and Zhaojin Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wheaton Precious Metals and Zhaojin Mining Industry, you can compare the effects of market volatilities on Wheaton Precious and Zhaojin 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 Wheaton Precious with a short position of Zhaojin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wheaton Precious and Zhaojin Mining.
Diversification Opportunities for Wheaton Precious and Zhaojin Mining
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Wheaton and Zhaojin is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Wheaton Precious Metals and Zhaojin Mining Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhaojin Mining Industry and Wheaton Precious 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 Wheaton Precious Metals are associated (or correlated) with Zhaojin Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhaojin Mining Industry has no effect on the direction of Wheaton Precious i.e., Wheaton Precious and Zhaojin Mining go up and down completely randomly.
Pair Corralation between Wheaton Precious and Zhaojin Mining
Considering the 90-day investment horizon Wheaton Precious is expected to generate 1.64 times less return on investment than Zhaojin Mining. But when comparing it to its historical volatility, Wheaton Precious Metals is 1.71 times less risky than Zhaojin Mining. It trades about 0.09 of its potential returns per unit of risk. Zhaojin Mining Industry is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 125.00 in Zhaojin Mining Industry on November 28, 2024 and sell it today you would earn a total of 23.00 from holding Zhaojin Mining Industry or generate 18.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 23.85% |
| Values | Daily Returns |
Wheaton Precious Metals vs. Zhaojin Mining Industry
Performance |
| Timeline |
| Wheaton Precious Metals |
| Zhaojin Mining Industry |
Wheaton Precious and Zhaojin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wheaton Precious and Zhaojin Mining
The main advantage of trading using opposite Wheaton Precious and Zhaojin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wheaton Precious position performs unexpectedly, Zhaojin 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 Zhaojin Mining will offset losses from the drop in Zhaojin Mining's long position.| Wheaton Precious vs. Royal Gold | Wheaton Precious vs. Agnico Eagle Mines | Wheaton Precious vs. Sandstorm Gold Ltd | Wheaton Precious vs. Osisko Gold Ro |
| Zhaojin Mining vs. Franco Nevada | Zhaojin Mining vs. Wheaton Precious Metals | Zhaojin Mining vs. Seabridge Gold | Zhaojin Mining vs. Osisko Gold Ro |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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