Correlation Between Gold Fields and Chevron Corp
Can any of the company-specific risk be diversified away by investing in both Gold Fields and Chevron Corp 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 Gold Fields and Chevron Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gold Fields Ltd and Chevron Corp, you can compare the effects of market volatilities on Gold Fields and Chevron Corp 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 Gold Fields with a short position of Chevron Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gold Fields and Chevron Corp.
Diversification Opportunities for Gold Fields and Chevron Corp
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Gold and Chevron is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Gold Fields Ltd and Chevron Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chevron Corp and Gold Fields 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 Gold Fields Ltd are associated (or correlated) with Chevron Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chevron Corp has no effect on the direction of Gold Fields i.e., Gold Fields and Chevron Corp go up and down completely randomly.
Pair Corralation between Gold Fields and Chevron Corp
Considering the 90-day investment horizon Gold Fields Ltd is expected to generate 1.51 times more return on investment than Chevron Corp. However, Gold Fields is 1.51 times more volatile than Chevron Corp. It trades about 0.46 of its potential returns per unit of risk. Chevron Corp is currently generating about -0.08 per unit of risk. If you would invest 1,529 in Gold Fields Ltd on November 18, 2024 and sell it today you would earn a total of 358.00 from holding Gold Fields Ltd or generate 23.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gold Fields Ltd vs. Chevron Corp
Performance |
| Timeline |
| Gold Fields |
| Chevron Corp |
Gold Fields and Chevron Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gold Fields and Chevron Corp
The main advantage of trading using opposite Gold Fields and Chevron Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gold Fields position performs unexpectedly, Chevron Corp 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 Chevron Corp will offset losses from the drop in Chevron Corp's long position.| Gold Fields vs. Agnico Eagle Mines | Gold Fields vs. Kinross Gold | Gold Fields vs. Harmony Gold Mining | Gold Fields vs. Franco Nevada |
| Chevron Corp vs. TotalEnergies SE ADR | Chevron Corp vs. Equinor ASA ADR | Chevron Corp vs. Petrleo Brasileiro SA | Chevron Corp vs. Ecopetrol SA ADR |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |