Correlation Between ZKB Gold and ZKB GOLDETF

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

By analyzing existing cross correlation between ZKB Gold ETF and ZKB GOLDETF AAH, you can compare the effects of market volatilities on ZKB Gold and ZKB GOLDETF 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 Gold with a short position of ZKB GOLDETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZKB Gold and ZKB GOLDETF.

Diversification Opportunities for ZKB Gold and ZKB GOLDETF

0.0

Correlation Coefficient

ZKB Gold  ZKB GOLDETF

Pay attention - limited upside

The 3 months correlation between ZKB and ZKB is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ZKB Gold ETF and ZKB GOLDETF AAH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZKB GOLDETF AAH and ZKB Gold 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 Gold ETF are associated (or correlated) with ZKB GOLDETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZKB GOLDETF AAH has no effect on the direction of ZKB Gold i.e., ZKB Gold and ZKB GOLDETF go up and down completely randomly.

Pair Corralation between ZKB Gold and ZKB GOLDETF

If you would invest  234,350  in ZKB Gold ETF on September 29, 2024 and sell it today you would earn a total of  850.00  from holding ZKB Gold ETF or generate 0.36% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

ZKB Gold ETF  vs.  ZKB GOLDETF AAH

ZKB Gold ETF

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ZKB Gold ETF are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak essential indicators, ZKB Gold may actually be approaching a critical reversion point that can send shares even higher in January 2025.

ZKB GOLDETF AAH

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ZKB GOLDETF AAH has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, ZKB GOLDETF is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with ZKB Gold and ZKB GOLDETF

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

The idea behind ZKB Gold ETF and ZKB GOLDETF AAH 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.