Correlation Between VersaBank and Newmont Goldcorp
Can any of the company-specific risk be diversified away by investing in both VersaBank 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 VersaBank and Newmont Goldcorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VersaBank and Newmont Goldcorp Corp, you can compare the effects of market volatilities on VersaBank 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 VersaBank with a short position of Newmont Goldcorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of VersaBank and Newmont Goldcorp.
Diversification Opportunities for VersaBank and Newmont Goldcorp
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between VersaBank and Newmont is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding VersaBank 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 VersaBank 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 VersaBank 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 VersaBank i.e., VersaBank and Newmont Goldcorp go up and down completely randomly.
Pair Corralation between VersaBank and Newmont Goldcorp
Assuming the 90 days trading horizon VersaBank is expected to generate 1.0 times more return on investment than Newmont Goldcorp. However, VersaBank is 1.0 times more volatile than Newmont Goldcorp Corp. It trades about 0.08 of its potential returns per unit of risk. Newmont Goldcorp Corp is currently generating about -0.01 per unit of risk. If you would invest 1,011 in VersaBank on October 9, 2024 and sell it today you would earn a total of 1,023 from holding VersaBank or generate 101.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
VersaBank vs. Newmont Goldcorp Corp
Performance |
| Timeline |
| VersaBank |
| Newmont Goldcorp Corp |
VersaBank and Newmont Goldcorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VersaBank and Newmont Goldcorp
The main advantage of trading using opposite VersaBank and Newmont Goldcorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VersaBank 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.| VersaBank vs. Sylogist | VersaBank vs. Sangoma Technologies Corp | VersaBank vs. Firan Technology Group | VersaBank vs. Hammond Power Solutions |
| Newmont Goldcorp vs. QC Copper and | Newmont Goldcorp vs. Marimaca Copper Corp | Newmont Goldcorp vs. Northwest Copper Corp | Newmont Goldcorp vs. Chakana Copper 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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