Correlation Between Newmont Goldcorp and Barrick Gold

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Newmont Goldcorp and Barrick 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 Newmont Goldcorp and Barrick Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Newmont Goldcorp Corp and Barrick Gold Corp, you can compare the effects of market volatilities on Newmont Goldcorp and Barrick 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 Newmont Goldcorp with a short position of Barrick Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newmont Goldcorp and Barrick Gold.

Diversification Opportunities for Newmont Goldcorp and Barrick Gold

NewmontBarrickDiversified AwayNewmontBarrickDiversified Away100%
0.83
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Newmont and Barrick is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Newmont Goldcorp Corp and Barrick Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barrick Gold Corp and Newmont Goldcorp 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 Newmont Goldcorp Corp are associated (or correlated) with Barrick Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barrick Gold Corp has no effect on the direction of Newmont Goldcorp i.e., Newmont Goldcorp and Barrick Gold go up and down completely randomly.

Pair Corralation between Newmont Goldcorp and Barrick Gold

Considering the 90-day investment horizon Newmont Goldcorp is expected to generate 4.26 times less return on investment than Barrick Gold. In addition to that, Newmont Goldcorp is 1.18 times more volatile than Barrick Gold Corp. It trades about 0.04 of its total potential returns per unit of risk. Barrick Gold Corp is currently generating about 0.23 per unit of volatility. If you would invest  1,606  in Barrick Gold Corp on November 27, 2024 and sell it today you would earn a total of  176.00  from holding Barrick Gold Corp or generate 10.96% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Newmont Goldcorp Corp  vs.  Barrick Gold Corp

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -5051015
JavaScript chart by amCharts 3.21.15NEM GOLD
       Timeline  
Newmont Goldcorp Corp 

Risk-Adjusted Performance

Modest

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Newmont Goldcorp Corp are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain technical and fundamental indicators, Newmont Goldcorp may actually be approaching a critical reversion point that can send shares even higher in March 2025.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb384042444648
Barrick Gold Corp 

Risk-Adjusted Performance

Insignificant

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Barrick Gold Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound essential indicators, Barrick Gold is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb15.51616.51717.51818.519

Newmont Goldcorp and Barrick Gold Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-6.04-4.52-3.01-1.490.01.563.164.756.34 0.020.040.060.080.10
JavaScript chart by amCharts 3.21.15NEM GOLD
       Returns  

Pair Trading with Newmont Goldcorp and Barrick Gold

The main advantage of trading using opposite Newmont Goldcorp and Barrick Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Newmont Goldcorp position performs unexpectedly, Barrick 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 Barrick Gold will offset losses from the drop in Barrick Gold's long position.
The idea behind Newmont Goldcorp Corp and Barrick Gold Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.

Other Complementary Tools

Financial Widgets
Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets
Price Transformation
Use Price Transformation models to analyze the depth of different equity instruments across global markets
Commodity Channel
Use Commodity Channel Index to analyze current equity momentum
Portfolio Center
All portfolio management and optimization tools to improve performance of your portfolios
CEOs Directory
Screen CEOs from public companies around the world