Correlation Between B2Gold Corp and Barrick Gold
Can any of the company-specific risk be diversified away by investing in both B2Gold Corp and Barrick Gold 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 B2Gold Corp and Barrick Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between B2Gold Corp and Barrick Gold Corp, you can compare the effects of market volatilities on B2Gold Corp and Barrick Gold 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 B2Gold Corp with a short position of Barrick Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of B2Gold Corp and Barrick Gold.
Diversification Opportunities for B2Gold Corp and Barrick Gold
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between B2Gold and Barrick is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding B2Gold Corp and Barrick Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barrick Gold Corp and B2Gold Corp 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 B2Gold Corp are associated (or correlated) with Barrick Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barrick Gold Corp has no effect on the direction of B2Gold Corp i.e., B2Gold Corp and Barrick Gold go up and down completely randomly.
Pair Corralation between B2Gold Corp and Barrick Gold
Considering the 90-day investment horizon B2Gold Corp is expected to under-perform the Barrick Gold. In addition to that, B2Gold Corp is 1.26 times more volatile than Barrick Gold Corp. It trades about 0.0 of its total potential returns per unit of risk. Barrick Gold Corp is currently generating about 0.02 per unit of volatility. If you would invest 1,742 in Barrick Gold Corp on August 27, 2024 and sell it today you would earn a total of 80.00 from holding Barrick Gold Corp or generate 4.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
B2Gold Corp vs. Barrick Gold Corp
Performance |
| Timeline |
| B2Gold Corp |
| Barrick Gold Corp |
B2Gold Corp and Barrick Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with B2Gold Corp and Barrick Gold
The main advantage of trading using opposite B2Gold Corp and Barrick Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if B2Gold Corp position performs unexpectedly, Barrick Gold 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 Barrick Gold will offset losses from the drop in Barrick Gold's long position.| B2Gold Corp vs. Sandstorm Gold Ltd | B2Gold Corp vs. Kinross Gold | B2Gold Corp vs. Alamos Gold | B2Gold Corp vs. Fortuna Silver Mines |
| Barrick Gold vs. Agnico Eagle Mines | Barrick Gold vs. Pan American Silver | Barrick Gold vs. Wheaton Precious Metals | Barrick Gold vs. Kinross Gold |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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