Correlation Between Zijin Mining and Omai Gold
Can any of the company-specific risk be diversified away by investing in both Zijin Mining and Omai Gold 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 Omai Gold 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 Omai Gold Mines, you can compare the effects of market volatilities on Zijin Mining and Omai Gold 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 Omai Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zijin Mining and Omai Gold.
Diversification Opportunities for Zijin Mining and Omai Gold
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Zijin and Omai is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Zijin Mining Group and Omai Gold Mines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Omai Gold Mines 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 Omai Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Omai Gold Mines has no effect on the direction of Zijin Mining i.e., Zijin Mining and Omai Gold go up and down completely randomly.
Pair Corralation between Zijin Mining and Omai Gold
Assuming the 90 days horizon Zijin Mining is expected to generate 4.2 times less return on investment than Omai Gold. But when comparing it to its historical volatility, Zijin Mining Group is 3.2 times less risky than Omai Gold. It trades about 0.17 of its potential returns per unit of risk. Omai Gold Mines is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 15.00 in Omai Gold Mines on October 21, 2024 and sell it today you would earn a total of 5.00 from holding Omai Gold Mines or generate 33.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zijin Mining Group vs. Omai Gold Mines
Performance |
| Timeline |
| Zijin Mining Group |
| Omai Gold Mines |
Zijin Mining and Omai Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zijin Mining and Omai Gold
The main advantage of trading using opposite Zijin Mining and Omai Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zijin Mining position performs unexpectedly, Omai Gold 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 Omai Gold will offset losses from the drop in Omai Gold's long position.| Zijin Mining vs. AngloGold Ashanti plc | Zijin Mining vs. Harmony Gold Mining | Zijin Mining vs. Eldorado Gold Corp | Zijin Mining vs. Kinross Gold |
| Omai Gold vs. Getchell Gold Corp | Omai Gold vs. Galiano Gold | Omai Gold vs. B2Gold Corp | Omai Gold vs. Grande Portage Resources |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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