Correlation Between Zijin Mining and Vertiv Holdings
Can any of the company-specific risk be diversified away by investing in both Zijin Mining and Vertiv Holdings 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 Vertiv Holdings 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 Vertiv Holdings Co, you can compare the effects of market volatilities on Zijin Mining and Vertiv Holdings 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 Vertiv Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zijin Mining and Vertiv Holdings.
Diversification Opportunities for Zijin Mining and Vertiv Holdings
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Zijin and Vertiv is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Zijin Mining Group and Vertiv Holdings Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vertiv Holdings 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 Vertiv Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vertiv Holdings has no effect on the direction of Zijin Mining i.e., Zijin Mining and Vertiv Holdings go up and down completely randomly.
Pair Corralation between Zijin Mining and Vertiv Holdings
Assuming the 90 days horizon Zijin Mining is expected to generate 1.97 times less return on investment than Vertiv Holdings. In addition to that, Zijin Mining is 1.17 times more volatile than Vertiv Holdings Co. It trades about 0.06 of its total potential returns per unit of risk. Vertiv Holdings Co is currently generating about 0.14 per unit of volatility. If you would invest 3,969 in Vertiv Holdings Co on September 1, 2024 and sell it today you would earn a total of 8,791 from holding Vertiv Holdings Co or generate 221.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 90.71% |
| Values | Daily Returns |
Zijin Mining Group vs. Vertiv Holdings Co
Performance |
| Timeline |
| Zijin Mining Group |
| Vertiv Holdings |
Zijin Mining and Vertiv Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zijin Mining and Vertiv Holdings
The main advantage of trading using opposite Zijin Mining and Vertiv Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zijin Mining position performs unexpectedly, Vertiv Holdings 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 Vertiv Holdings will offset losses from the drop in Vertiv Holdings' long position.| Zijin Mining vs. Aurion Resources | Zijin Mining vs. Rio2 Limited | Zijin Mining vs. Palamina Corp | Zijin Mining vs. BTU Metals Corp |
| Vertiv Holdings vs. nVent Electric PLC | Vertiv Holdings vs. Hubbell | Vertiv Holdings vs. Advanced Energy Industries | Vertiv Holdings vs. Energizer Holdings |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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