Correlation Between Newmont Goldcorp and AuQ Gold
Can any of the company-specific risk be diversified away by investing in both Newmont Goldcorp and AuQ 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 AuQ 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 AuQ Gold Mining, you can compare the effects of market volatilities on Newmont Goldcorp and AuQ 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 AuQ Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newmont Goldcorp and AuQ Gold.
Diversification Opportunities for Newmont Goldcorp and AuQ Gold
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Newmont and AuQ is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Newmont Goldcorp Corp and AuQ Gold Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AuQ Gold Mining 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 AuQ Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AuQ Gold Mining has no effect on the direction of Newmont Goldcorp i.e., Newmont Goldcorp and AuQ Gold go up and down completely randomly.
Pair Corralation between Newmont Goldcorp and AuQ Gold
Considering the 90-day investment horizon Newmont Goldcorp Corp is expected to generate 0.27 times more return on investment than AuQ Gold. However, Newmont Goldcorp Corp is 3.7 times less risky than AuQ Gold. It trades about 0.02 of its potential returns per unit of risk. AuQ Gold Mining is currently generating about -0.3 per unit of risk. If you would invest 4,208 in Newmont Goldcorp Corp on September 12, 2024 and sell it today you would earn a total of 20.00 from holding Newmont Goldcorp Corp or generate 0.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Newmont Goldcorp Corp vs. AuQ Gold Mining
Performance |
| Timeline |
| Newmont Goldcorp Corp |
| AuQ Gold Mining |
Newmont Goldcorp and AuQ Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Newmont Goldcorp and AuQ Gold
The main advantage of trading using opposite Newmont Goldcorp and AuQ Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Newmont Goldcorp position performs unexpectedly, AuQ 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 AuQ Gold will offset losses from the drop in AuQ Gold's long position.| Newmont Goldcorp vs. Pan American Silver | Newmont Goldcorp vs. Agnico Eagle Mines | Newmont Goldcorp vs. Kinross Gold | Newmont Goldcorp vs. Wheaton Precious Metals |
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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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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