Correlation Between ZIJIN MINH and Evolution Mining

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

By analyzing existing cross correlation between ZIJIN MINH UNSPADR20 and Evolution Mining Limited, you can compare the effects of market volatilities on ZIJIN MINH and Evolution 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 ZIJIN MINH with a short position of Evolution Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZIJIN MINH and Evolution Mining.

Diversification Opportunities for ZIJIN MINH and Evolution Mining

-0.38

Correlation Coefficient

ZIJIN MINH  Evolution Mining

Very good diversification

The 3 months correlation between ZIJIN and Evolution is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding ZIJIN MINH UNSPADR20 and Evolution Mining Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evolution Mining and ZIJIN MINH 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 MINH UNSPADR20 are associated (or correlated) with Evolution Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evolution Mining has no effect on the direction of ZIJIN MINH i.e., ZIJIN MINH and Evolution Mining go up and down completely randomly.

Pair Corralation between ZIJIN MINH and Evolution Mining

Assuming the 90 days trading horizon ZIJIN MINH UNSPADR20 is expected to generate 0.71 times more return on investment than Evolution Mining. However, ZIJIN MINH UNSPADR20 is 1.41 times less risky than Evolution Mining. It trades about 0.21 of its potential returns per unit of risk. Evolution Mining Limited is currently generating about -0.02 per unit of risk. If you would invest  3,576  in ZIJIN MINH UNSPADR20 on April 25, 2025 and sell it today you would earn a total of  1,064  from holding ZIJIN MINH UNSPADR20 or generate 29.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

ZIJIN MINH UNSPADR20  vs.  Evolution Mining Limited

ZIJIN MINH UNSPADR20

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in ZIJIN MINH UNSPADR20 are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, ZIJIN MINH reported solid returns over the last few months and may actually be approaching a breakup point.

Evolution Mining

Risk-Adjusted Performance

Very Weak

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

Pair Trading with ZIJIN MINH and Evolution Mining

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

The idea behind ZIJIN MINH UNSPADR20 and Evolution Mining Limited 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.