Correlation Between Zijin Mining and Ecovyst
Can any of the company-specific risk be diversified away by investing in both Zijin Mining and Ecovyst 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 Ecovyst 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 Ecovyst, you can compare the effects of market volatilities on Zijin Mining and Ecovyst 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 Ecovyst. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zijin Mining and Ecovyst.
Diversification Opportunities for Zijin Mining and Ecovyst
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Zijin and Ecovyst is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Zijin Mining Group and Ecovyst in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ecovyst 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 Ecovyst. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ecovyst has no effect on the direction of Zijin Mining i.e., Zijin Mining and Ecovyst go up and down completely randomly.
Pair Corralation between Zijin Mining and Ecovyst
Assuming the 90 days horizon Zijin Mining Group is expected to under-perform the Ecovyst. In addition to that, Zijin Mining is 1.98 times more volatile than Ecovyst. It trades about -0.17 of its total potential returns per unit of risk. Ecovyst is currently generating about 0.12 per unit of volatility. If you would invest 762.00 in Ecovyst on September 2, 2024 and sell it today you would earn a total of 33.00 from holding Ecovyst or generate 4.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zijin Mining Group vs. Ecovyst
Performance |
| Timeline |
| Zijin Mining Group |
| Ecovyst |
Zijin Mining and Ecovyst Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zijin Mining and Ecovyst
The main advantage of trading using opposite Zijin Mining and Ecovyst positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zijin Mining position performs unexpectedly, Ecovyst 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 Ecovyst will offset losses from the drop in Ecovyst'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 |
| Ecovyst vs. Orion Engineered Carbons | Ecovyst vs. Cabot | Ecovyst vs. Minerals Technologies | Ecovyst vs. Quaker Chemical |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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