Correlation Between ZKB Silver and ZKB Gold
Can any of the company-specific risk be diversified away by investing in both ZKB Silver and ZKB 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 ZKB Silver and ZKB Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ZKB Silver ETF and ZKB Gold ETF, you can compare the effects of market volatilities on ZKB Silver and ZKB 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 ZKB Silver with a short position of ZKB Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZKB Silver and ZKB Gold.
Diversification Opportunities for ZKB Silver and ZKB Gold
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ZKB and ZKB is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding ZKB Silver ETF and ZKB Gold ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZKB Gold ETF and ZKB Silver 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 ZKB Silver ETF are associated (or correlated) with ZKB Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZKB Gold ETF has no effect on the direction of ZKB Silver i.e., ZKB Silver and ZKB Gold go up and down completely randomly.
Pair Corralation between ZKB Silver and ZKB Gold
Assuming the 90 days trading horizon ZKB Silver is expected to generate 1.37 times less return on investment than ZKB Gold. In addition to that, ZKB Silver is 2.07 times more volatile than ZKB Gold ETF. It trades about 0.04 of its total potential returns per unit of risk. ZKB Gold ETF is currently generating about 0.1 per unit of volatility. If you would invest 170,260 in ZKB Gold ETF on September 13, 2024 and sell it today you would earn a total of 84,140 from holding ZKB Gold ETF or generate 49.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.8% |
| Values | Daily Returns |
ZKB Silver ETF vs. ZKB Gold ETF
Performance |
| Timeline |
| ZKB Silver ETF |
| ZKB Gold ETF |
ZKB Silver and ZKB Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZKB Silver and ZKB Gold
The main advantage of trading using opposite ZKB Silver and ZKB Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZKB Silver position performs unexpectedly, ZKB 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 ZKB Gold will offset losses from the drop in ZKB Gold's long position.| ZKB Silver vs. Baloise Holding AG | ZKB Silver vs. 21Shares Polkadot ETP | ZKB Silver vs. UBS ETF MSCI | ZKB Silver vs. BB Biotech AG |
| ZKB Gold vs. ZKB Silver ETF | ZKB Gold vs. ZKB Gold ETF | ZKB Gold vs. ZKB Gold ETF | ZKB Gold vs. ZKB Platinum ETF |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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