Correlation Between Newmont Goldcorp and Orefinders Resources
Can any of the company-specific risk be diversified away by investing in both Newmont Goldcorp and Orefinders Resources 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 Orefinders Resources 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 Orefinders Resources, you can compare the effects of market volatilities on Newmont Goldcorp and Orefinders Resources 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 Orefinders Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newmont Goldcorp and Orefinders Resources.
Diversification Opportunities for Newmont Goldcorp and Orefinders Resources
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Newmont and Orefinders is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Newmont Goldcorp Corp and Orefinders Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orefinders Resources 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 Orefinders Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orefinders Resources has no effect on the direction of Newmont Goldcorp i.e., Newmont Goldcorp and Orefinders Resources go up and down completely randomly.
Pair Corralation between Newmont Goldcorp and Orefinders Resources
Considering the 90-day investment horizon Newmont Goldcorp Corp is expected to under-perform the Orefinders Resources. But the stock apears to be less risky and, when comparing its historical volatility, Newmont Goldcorp Corp is 1.95 times less risky than Orefinders Resources. The stock trades about -0.17 of its potential returns per unit of risk. The Orefinders Resources is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 4.32 in Orefinders Resources on September 1, 2024 and sell it today you would earn a total of 0.29 from holding Orefinders Resources or generate 6.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Newmont Goldcorp Corp vs. Orefinders Resources
Performance |
| Timeline |
| Newmont Goldcorp Corp |
| Orefinders Resources |
Newmont Goldcorp and Orefinders Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Newmont Goldcorp and Orefinders Resources
The main advantage of trading using opposite Newmont Goldcorp and Orefinders Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Newmont Goldcorp position performs unexpectedly, Orefinders Resources 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 Orefinders Resources will offset losses from the drop in Orefinders Resources' 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 |
| Orefinders Resources vs. Aurion Resources | Orefinders Resources vs. Rio2 Limited | Orefinders Resources vs. Palamina Corp | Orefinders Resources 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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