Correlation Between Barrick Gold and Solstice Gold
Can any of the company-specific risk be diversified away by investing in both Barrick Gold and Solstice 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 Barrick Gold and Solstice Gold 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 Solstice Gold Corp, you can compare the effects of market volatilities on Barrick Gold and Solstice 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 Barrick Gold with a short position of Solstice Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barrick Gold and Solstice Gold.
Diversification Opportunities for Barrick Gold and Solstice Gold
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Barrick and Solstice is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Barrick Gold Corp and Solstice Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solstice Gold Corp 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 Solstice Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solstice Gold Corp has no effect on the direction of Barrick Gold i.e., Barrick Gold and Solstice Gold go up and down completely randomly.
Pair Corralation between Barrick Gold and Solstice Gold
Given the investment horizon of 90 days Barrick Gold is expected to generate 27.98 times less return on investment than Solstice Gold. But when comparing it to its historical volatility, Barrick Gold Corp is 13.3 times less risky than Solstice Gold. It trades about 0.04 of its potential returns per unit of risk. Solstice Gold Corp is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 3.00 in Solstice Gold Corp on September 1, 2024 and sell it today you would lose (1.11) from holding Solstice Gold Corp or give up 37.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.47% |
| Values | Daily Returns |
Barrick Gold Corp vs. Solstice Gold Corp
Performance |
| Timeline |
| Barrick Gold Corp |
| Solstice Gold Corp |
Barrick Gold and Solstice Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barrick Gold and Solstice Gold
The main advantage of trading using opposite Barrick Gold and Solstice Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barrick Gold position performs unexpectedly, Solstice 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 Solstice Gold will offset losses from the drop in Solstice Gold'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 |
| Solstice Gold vs. Aurion Resources | Solstice Gold vs. Rio2 Limited | Solstice Gold vs. Palamina Corp | Solstice Gold vs. BTU Metals Corp |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |