Correlation Between IShares Silver and Newmont Goldcorp
Can any of the company-specific risk be diversified away by investing in both IShares Silver and Newmont Goldcorp 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 IShares Silver and Newmont Goldcorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Silver Trust and Newmont Goldcorp Corp, you can compare the effects of market volatilities on IShares Silver and Newmont Goldcorp 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 IShares Silver with a short position of Newmont Goldcorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Silver and Newmont Goldcorp.
Diversification Opportunities for IShares Silver and Newmont Goldcorp
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between IShares and Newmont is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding iShares Silver Trust and Newmont Goldcorp Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Newmont Goldcorp Corp and IShares Silver 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 iShares Silver Trust are associated (or correlated) with Newmont Goldcorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Newmont Goldcorp Corp has no effect on the direction of IShares Silver i.e., IShares Silver and Newmont Goldcorp go up and down completely randomly.
Pair Corralation between IShares Silver and Newmont Goldcorp
Considering the 90-day investment horizon iShares Silver Trust is expected to under-perform the Newmont Goldcorp. But the etf apears to be less risky and, when comparing its historical volatility, iShares Silver Trust is 1.09 times less risky than Newmont Goldcorp. The etf trades about -0.33 of its potential returns per unit of risk. The Newmont Goldcorp Corp is currently generating about -0.26 of returns per unit of risk over similar time horizon. If you would invest 4,752 in Newmont Goldcorp Corp on August 30, 2024 and sell it today you would lose (548.00) from holding Newmont Goldcorp Corp or give up 11.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
iShares Silver Trust vs. Newmont Goldcorp Corp
Performance |
| Timeline |
| iShares Silver Trust |
| Newmont Goldcorp Corp |
IShares Silver and Newmont Goldcorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Silver and Newmont Goldcorp
The main advantage of trading using opposite IShares Silver and Newmont Goldcorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Silver position performs unexpectedly, Newmont Goldcorp 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 Newmont Goldcorp will offset losses from the drop in Newmont Goldcorp's long position.| IShares Silver vs. SPDR Gold Shares | IShares Silver vs. VanEck Gold Miners | IShares Silver vs. United States Oil | IShares Silver vs. iShares Gold Trust |
| Newmont Goldcorp vs. Pan American Silver | Newmont Goldcorp vs. Agnico Eagle Mines | Newmont Goldcorp vs. Kinross Gold | Newmont Goldcorp vs. Wheaton Precious Metals |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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