Correlation Between Zijin Mining and Tarachi Gold
Can any of the company-specific risk be diversified away by investing in both Zijin Mining and Tarachi 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 Tarachi 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 Tarachi Gold Corp, you can compare the effects of market volatilities on Zijin Mining and Tarachi 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 Tarachi Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zijin Mining and Tarachi Gold.
Diversification Opportunities for Zijin Mining and Tarachi Gold
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Zijin and Tarachi is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Zijin Mining Group and Tarachi Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tarachi Gold Corp 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 Tarachi Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tarachi Gold Corp has no effect on the direction of Zijin Mining i.e., Zijin Mining and Tarachi Gold go up and down completely randomly.
Pair Corralation between Zijin Mining and Tarachi Gold
Assuming the 90 days horizon Zijin Mining Group is expected to under-perform the Tarachi Gold. But the pink sheet apears to be less risky and, when comparing its historical volatility, Zijin Mining Group is 2.61 times less risky than Tarachi Gold. The pink sheet trades about 0.0 of its potential returns per unit of risk. The Tarachi Gold Corp is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 2.60 in Tarachi Gold Corp on September 3, 2024 and sell it today you would lose (0.80) from holding Tarachi Gold Corp or give up 30.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.2% |
| Values | Daily Returns |
Zijin Mining Group vs. Tarachi Gold Corp
Performance |
| Timeline |
| Zijin Mining Group |
| Tarachi Gold Corp |
Zijin Mining and Tarachi Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zijin Mining and Tarachi Gold
The main advantage of trading using opposite Zijin Mining and Tarachi Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zijin Mining position performs unexpectedly, Tarachi 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 Tarachi Gold will offset losses from the drop in Tarachi 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 |
| Tarachi Gold vs. Avidian Gold Corp | Tarachi Gold vs. FireFox Gold Corp | Tarachi Gold vs. Getchell Gold Corp | Tarachi Gold vs. Viva Gold Corp |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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