Correlation Between Zijin Mining and SYSTEMAIR

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

By analyzing existing cross correlation between Zijin Mining Group and SYSTEMAIR AB, you can compare the effects of market volatilities on Zijin Mining and SYSTEMAIR 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 Zijin Mining with a short position of SYSTEMAIR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zijin Mining and SYSTEMAIR.

Diversification Opportunities for Zijin Mining and SYSTEMAIR

0.25

Correlation Coefficient

Zijin Mining  SYSTEMAIR

Modest diversification

The 3 months correlation between Zijin and SYSTEMAIR is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Zijin Mining Group and SYSTEMAIR AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SYSTEMAIR AB and Zijin Mining 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 Zijin Mining Group are associated (or correlated) with SYSTEMAIR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SYSTEMAIR AB has no effect on the direction of Zijin Mining i.e., Zijin Mining and SYSTEMAIR go up and down completely randomly.

Pair Corralation between Zijin Mining and SYSTEMAIR

Assuming the 90 days horizon Zijin Mining Group is expected to generate 1.11 times more return on investment than SYSTEMAIR. However, Zijin Mining is 1.11 times more volatile than SYSTEMAIR AB. It trades about 0.06 of its potential returns per unit of risk. SYSTEMAIR AB is currently generating about 0.04 per unit of risk. If you would invest  86.00  in Zijin Mining Group on February 11, 2025 and sell it today you would earn a total of  107.00  from holding Zijin Mining Group or generate 124.42% return on investment over 90 days.

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

Zijin Mining Group  vs.  SYSTEMAIR AB

Zijin Mining Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Zijin Mining Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Zijin Mining is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

SYSTEMAIR AB

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in SYSTEMAIR AB are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, SYSTEMAIR may actually be approaching a critical reversion point that can send shares even higher in June 2025.

Pair Trading with Zijin Mining and SYSTEMAIR

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

The idea behind Zijin Mining Group and SYSTEMAIR AB 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.