Correlation Between Newcrest Mining and Resolute Mining
Can any of the company-specific risk be diversified away by investing in both Newcrest Mining and Resolute Mining 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 Newcrest Mining and Resolute Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Newcrest Mining and Resolute Mining Limited, you can compare the effects of market volatilities on Newcrest Mining and Resolute Mining 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 Newcrest Mining with a short position of Resolute Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newcrest Mining and Resolute Mining.
Diversification Opportunities for Newcrest Mining and Resolute Mining
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Newcrest and Resolute is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Newcrest Mining and Resolute Mining Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Resolute Mining and Newcrest Mining 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 Newcrest Mining are associated (or correlated) with Resolute Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Resolute Mining has no effect on the direction of Newcrest Mining i.e., Newcrest Mining and Resolute Mining go up and down completely randomly.
Pair Corralation between Newcrest Mining and Resolute Mining
If you would invest 1,800 in Newcrest Mining on August 25, 2024 and sell it today you would earn a total of 0.00 from holding Newcrest Mining or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 2.22% |
| Values | Daily Returns |
Newcrest Mining vs. Resolute Mining Limited
Performance |
| Timeline |
| Newcrest Mining |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Resolute Mining |
Newcrest Mining and Resolute Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Newcrest Mining and Resolute Mining
The main advantage of trading using opposite Newcrest Mining and Resolute Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Newcrest Mining position performs unexpectedly, Resolute Mining 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 Resolute Mining will offset losses from the drop in Resolute Mining's long position.| Newcrest Mining vs. Wesdome Gold Mines | Newcrest Mining vs. Gold Reserve | Newcrest Mining vs. Osisko Gold Ro | Newcrest Mining vs. I 80 Gold Corp |
| Resolute Mining vs. Aurion Resources | Resolute Mining vs. Minera Alamos | Resolute Mining vs. Rio2 Limited | Resolute Mining vs. Roscan Gold 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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