Correlation Between Newcrest Mining and Sibanye Stillwater
Can any of the company-specific risk be diversified away by investing in both Newcrest Mining and Sibanye Stillwater 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 Sibanye Stillwater into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Newcrest Mining and Sibanye Stillwater Limited, you can compare the effects of market volatilities on Newcrest Mining and Sibanye Stillwater 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 Sibanye Stillwater. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newcrest Mining and Sibanye Stillwater.
Diversification Opportunities for Newcrest Mining and Sibanye Stillwater
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Newcrest and Sibanye is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Newcrest Mining and Sibanye Stillwater Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sibanye Stillwater 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 Sibanye Stillwater. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sibanye Stillwater has no effect on the direction of Newcrest Mining i.e., Newcrest Mining and Sibanye Stillwater go up and down completely randomly.
Pair Corralation between Newcrest Mining and Sibanye Stillwater
Assuming the 90 days horizon Newcrest Mining is expected to generate 0.38 times more return on investment than Sibanye Stillwater. However, Newcrest Mining is 2.64 times less risky than Sibanye Stillwater. It trades about 0.06 of its potential returns per unit of risk. Sibanye Stillwater Limited is currently generating about -0.01 per unit of risk. If you would invest 1,757 in Newcrest Mining on September 2, 2024 and sell it today you would earn a total of 48.00 from holding Newcrest Mining or generate 2.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 8.06% |
| Values | Daily Returns |
Newcrest Mining vs. Sibanye Stillwater Limited
Performance |
| Timeline |
| Newcrest Mining |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Sibanye Stillwater |
Newcrest Mining and Sibanye Stillwater Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Newcrest Mining and Sibanye Stillwater
The main advantage of trading using opposite Newcrest Mining and Sibanye Stillwater positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Newcrest Mining position performs unexpectedly, Sibanye Stillwater 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 Sibanye Stillwater will offset losses from the drop in Sibanye Stillwater's long position.| Newcrest Mining vs. Big Ridge Gold | Newcrest Mining vs. Westhaven Gold Corp | Newcrest Mining vs. Satori Resources | Newcrest Mining vs. K92 Mining |
| Sibanye Stillwater vs. Vior Inc | Sibanye Stillwater vs. Peloton Minerals | Sibanye Stillwater vs. BTU Metals Corp | Sibanye Stillwater vs. Palamina 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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