Correlation Between OZ Minerals and Jiangxi Copper
Can any of the company-specific risk be diversified away by investing in both OZ Minerals and Jiangxi Copper 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 OZ Minerals and Jiangxi Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OZ Minerals Limited and Jiangxi Copper, you can compare the effects of market volatilities on OZ Minerals and Jiangxi Copper 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 OZ Minerals with a short position of Jiangxi Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of OZ Minerals and Jiangxi Copper.
Diversification Opportunities for OZ Minerals and Jiangxi Copper
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between OZMLF and Jiangxi is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding OZ Minerals Limited and Jiangxi Copper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangxi Copper and OZ Minerals 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 OZ Minerals Limited are associated (or correlated) with Jiangxi Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangxi Copper has no effect on the direction of OZ Minerals i.e., OZ Minerals and Jiangxi Copper go up and down completely randomly.
Pair Corralation between OZ Minerals and Jiangxi Copper
If you would invest 166.00 in Jiangxi Copper on September 19, 2024 and sell it today you would lose (4.00) from holding Jiangxi Copper or give up 2.41% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 4.55% |
Values | Daily Returns |
OZ Minerals Limited vs. Jiangxi Copper
Performance |
Timeline |
OZ Minerals Limited |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Jiangxi Copper |
OZ Minerals and Jiangxi Copper Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with OZ Minerals and Jiangxi Copper
The main advantage of trading using opposite OZ Minerals and Jiangxi Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OZ Minerals position performs unexpectedly, Jiangxi Copper 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 Jiangxi Copper will offset losses from the drop in Jiangxi Copper's long position.OZ Minerals vs. Valneva SE ADR | OZ Minerals vs. Lucid Group | OZ Minerals vs. CarsalesCom Ltd ADR | OZ Minerals vs. Marine Products |
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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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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