Correlation Between Barrick Gold and IAMGold
Can any of the company-specific risk be diversified away by investing in both Barrick Gold and IAMGold 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 Barrick Gold and IAMGold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barrick Gold Corp and IAMGold, you can compare the effects of market volatilities on Barrick Gold and IAMGold 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 Barrick Gold with a short position of IAMGold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barrick Gold and IAMGold.
Diversification Opportunities for Barrick Gold and IAMGold
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Barrick and IAMGold is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Barrick Gold Corp and IAMGold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IAMGold and Barrick Gold 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 Barrick Gold Corp are associated (or correlated) with IAMGold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IAMGold has no effect on the direction of Barrick Gold i.e., Barrick Gold and IAMGold go up and down completely randomly.
Pair Corralation between Barrick Gold and IAMGold
Given the investment horizon of 90 days Barrick Gold is expected to generate 5.56 times less return on investment than IAMGold. But when comparing it to its historical volatility, Barrick Gold Corp is 1.81 times less risky than IAMGold. It trades about 0.02 of its potential returns per unit of risk. IAMGold is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 210.00 in IAMGold on August 24, 2024 and sell it today you would earn a total of 360.00 from holding IAMGold or generate 171.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barrick Gold Corp vs. IAMGold
Performance |
| Timeline |
| Barrick Gold Corp |
| IAMGold |
Barrick Gold and IAMGold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barrick Gold and IAMGold
The main advantage of trading using opposite Barrick Gold and IAMGold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barrick Gold position performs unexpectedly, IAMGold 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 IAMGold will offset losses from the drop in IAMGold's long position.| Barrick Gold vs. Agnico Eagle Mines | Barrick Gold vs. Pan American Silver | Barrick Gold vs. Wheaton Precious Metals | Barrick Gold vs. Kinross Gold |
| IAMGold vs. Gold Fields Ltd | IAMGold vs. Barrick Gold Corp | IAMGold vs. Pan American Silver | IAMGold vs. Royal 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Transaction History View history of all your transactions and understand their impact on performance |