Correlation Between Zijin Mining and COPT Defense
Can any of the company-specific risk be diversified away by investing in both Zijin Mining and COPT Defense 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 Zijin Mining and COPT Defense into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zijin Mining Group and COPT Defense Properties, you can compare the effects of market volatilities on Zijin Mining and COPT Defense 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 Zijin Mining with a short position of COPT Defense. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zijin Mining and COPT Defense.
Diversification Opportunities for Zijin Mining and COPT Defense
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Zijin and COPT is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Zijin Mining Group and COPT Defense Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COPT Defense Properties and Zijin Mining 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 Zijin Mining Group are associated (or correlated) with COPT Defense. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COPT Defense Properties has no effect on the direction of Zijin Mining i.e., Zijin Mining and COPT Defense go up and down completely randomly.
Pair Corralation between Zijin Mining and COPT Defense
Assuming the 90 days horizon Zijin Mining Group is expected to generate 3.23 times more return on investment than COPT Defense. However, Zijin Mining is 3.23 times more volatile than COPT Defense Properties. It trades about 0.07 of its potential returns per unit of risk. COPT Defense Properties is currently generating about 0.11 per unit of risk. If you would invest 121.00 in Zijin Mining Group on September 14, 2024 and sell it today you would earn a total of 79.00 from holding Zijin Mining Group or generate 65.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 91.08% |
| Values | Daily Returns |
Zijin Mining Group vs. COPT Defense Properties
Performance |
| Timeline |
| Zijin Mining Group |
| COPT Defense Properties |
Zijin Mining and COPT Defense Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zijin Mining and COPT Defense
The main advantage of trading using opposite Zijin Mining and COPT Defense positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zijin Mining position performs unexpectedly, COPT Defense 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 COPT Defense will offset losses from the drop in COPT Defense's long position.| Zijin Mining vs. Torex Gold Resources | Zijin Mining vs. Wesdome Gold Mines | Zijin Mining vs. Northern Star Resources | Zijin Mining vs. Regis Resources |
| COPT Defense vs. Zijin Mining Group | COPT Defense vs. Kaiser Aluminum | COPT Defense vs. Sanyo Special Steel | COPT Defense vs. Olympic Steel |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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