Correlation Between Mirae Asset and Zinus

Can any of the company-specific risk be diversified away by investing in both Mirae Asset and Zinus 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 Mirae Asset and Zinus into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Mirae Asset Daewoo and Zinus Inc, you can compare the effects of market volatilities on Mirae Asset and Zinus 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 Mirae Asset with a short position of Zinus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mirae Asset and Zinus.

Diversification Opportunities for Mirae Asset and Zinus

0.33

Correlation Coefficient

Mirae Asset  Zinus

Weak diversification

The 3 months correlation between Mirae and Zinus is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Mirae Asset Daewoo and Zinus Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zinus Inc and Mirae Asset 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 Mirae Asset Daewoo are associated (or correlated) with Zinus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zinus Inc has no effect on the direction of Mirae Asset i.e., Mirae Asset and Zinus go up and down completely randomly.

Pair Corralation between Mirae Asset and Zinus

Assuming the 90 days trading horizon Mirae Asset is expected to generate 1.64 times less return on investment than Zinus. But when comparing it to its historical volatility, Mirae Asset Daewoo is 1.64 times less risky than Zinus. It trades about 0.01 of its potential returns per unit of risk. Zinus Inc is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  2,773,606  in Zinus Inc on October 5, 2024 and sell it today you would lose (113,606) from holding Zinus Inc or give up 4.1% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Mirae Asset Daewoo  vs.  Zinus Inc

Mirae Asset Daewoo

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Mirae Asset Daewoo are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Mirae Asset may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Zinus Inc

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Zinus Inc are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Zinus sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Mirae Asset and Zinus

The main advantage of trading using opposite Mirae Asset and Zinus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mirae Asset position performs unexpectedly, Zinus 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 Zinus will offset losses from the drop in Zinus' long position.

The idea behind Mirae Asset Daewoo and Zinus Inc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.