Correlation Between Dongfeng Automobile and Zijin Mining
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By analyzing existing cross correlation between Dongfeng Automobile Co and Zijin Mining Group, you can compare the effects of market volatilities on Dongfeng Automobile and Zijin Mining 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 Dongfeng Automobile with a short position of Zijin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongfeng Automobile and Zijin Mining.
Diversification Opportunities for Dongfeng Automobile and Zijin Mining
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dongfeng and Zijin is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Dongfeng Automobile Co and Zijin Mining Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zijin Mining Group and Dongfeng Automobile 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 Dongfeng Automobile Co are associated (or correlated) with Zijin Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zijin Mining Group has no effect on the direction of Dongfeng Automobile i.e., Dongfeng Automobile and Zijin Mining go up and down completely randomly.
Pair Corralation between Dongfeng Automobile and Zijin Mining
Assuming the 90 days trading horizon Dongfeng Automobile Co is expected to under-perform the Zijin Mining. In addition to that, Dongfeng Automobile is 1.48 times more volatile than Zijin Mining Group. It trades about -0.01 of its total potential returns per unit of risk. Zijin Mining Group is currently generating about 0.02 per unit of volatility. If you would invest 1,555 in Zijin Mining Group on September 26, 2024 and sell it today you would earn a total of 8.00 from holding Zijin Mining Group or generate 0.51% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Dongfeng Automobile Co vs. Zijin Mining Group
Performance |
Timeline |
Dongfeng Automobile |
Zijin Mining Group |
Dongfeng Automobile and Zijin Mining Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Dongfeng Automobile and Zijin Mining
The main advantage of trading using opposite Dongfeng Automobile and Zijin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongfeng Automobile position performs unexpectedly, Zijin Mining 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 Zijin Mining will offset losses from the drop in Zijin Mining's long position.Dongfeng Automobile vs. Chengtun Mining Group | Dongfeng Automobile vs. CICT Mobile Communication | Dongfeng Automobile vs. Dr Peng Telecom | Dongfeng Automobile vs. Jilin Jlu Communication |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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