Correlation Between Zijin Mining and Hf Foods
Can any of the company-specific risk be diversified away by investing in both Zijin Mining and Hf Foods 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 Hf Foods 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 Hf Foods Group, you can compare the effects of market volatilities on Zijin Mining and Hf Foods 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 Hf Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zijin Mining and Hf Foods.
Diversification Opportunities for Zijin Mining and Hf Foods
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Zijin and HFFG is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Zijin Mining Group and Hf Foods Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hf Foods Group 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 Hf Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hf Foods Group has no effect on the direction of Zijin Mining i.e., Zijin Mining and Hf Foods go up and down completely randomly.
Pair Corralation between Zijin Mining and Hf Foods
Assuming the 90 days horizon Zijin Mining Group is expected to generate 2.39 times more return on investment than Hf Foods. However, Zijin Mining is 2.39 times more volatile than Hf Foods Group. It trades about 0.06 of its potential returns per unit of risk. Hf Foods Group is currently generating about 0.01 per unit of risk. If you would invest 89.00 in Zijin Mining Group on August 29, 2024 and sell it today you would earn a total of 104.00 from holding Zijin Mining Group or generate 116.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.71% |
| Values | Daily Returns |
Zijin Mining Group vs. Hf Foods Group
Performance |
| Timeline |
| Zijin Mining Group |
| Hf Foods Group |
Zijin Mining and Hf Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zijin Mining and Hf Foods
The main advantage of trading using opposite Zijin Mining and Hf Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zijin Mining position performs unexpectedly, Hf Foods 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 Hf Foods will offset losses from the drop in Hf Foods' 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 |
| Hf Foods vs. Innovative Food Hldg | Hf Foods vs. G Willi Food International | Hf Foods vs. Calavo Growers | Hf Foods vs. The Chefs Warehouse |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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