Correlation Between Dollar Tree and ZKB Silver
Can any of the company-specific risk be diversified away by investing in both Dollar Tree and ZKB Silver 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 Dollar Tree and ZKB Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dollar Tree and ZKB Silver ETF, you can compare the effects of market volatilities on Dollar Tree and ZKB Silver 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 Dollar Tree with a short position of ZKB Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dollar Tree and ZKB Silver.
Diversification Opportunities for Dollar Tree and ZKB Silver
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dollar and ZKB is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Dollar Tree and ZKB Silver ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZKB Silver ETF and Dollar Tree 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 Dollar Tree are associated (or correlated) with ZKB Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZKB Silver ETF has no effect on the direction of Dollar Tree i.e., Dollar Tree and ZKB Silver go up and down completely randomly.
Pair Corralation between Dollar Tree and ZKB Silver
Given the investment horizon of 90 days Dollar Tree is expected to generate 1.53 times more return on investment than ZKB Silver. However, Dollar Tree is 1.53 times more volatile than ZKB Silver ETF. It trades about 0.17 of its potential returns per unit of risk. ZKB Silver ETF is currently generating about 0.18 per unit of risk. If you would invest 9,058 in Dollar Tree on May 29, 2025 and sell it today you would earn a total of 2,140 from holding Dollar Tree or generate 23.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.39% |
| Values | Daily Returns |
Dollar Tree vs. ZKB Silver ETF
Performance |
| Timeline |
| Dollar Tree |
| ZKB Silver ETF |
Dollar Tree and ZKB Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dollar Tree and ZKB Silver
The main advantage of trading using opposite Dollar Tree and ZKB Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dollar Tree position performs unexpectedly, ZKB Silver 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 Silver will offset losses from the drop in ZKB Silver's long position.| Dollar Tree vs. BJs Wholesale Club | Dollar Tree vs. Dollar General | Dollar Tree vs. Costco Wholesale Corp | Dollar Tree vs. Walmart |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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