Correlation Between Gold Road and Newcrest Mining
Can any of the company-specific risk be diversified away by investing in both Gold Road and Newcrest Mining 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 Gold Road and Newcrest Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gold Road Resources and Newcrest Mining, you can compare the effects of market volatilities on Gold Road and Newcrest Mining 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 Gold Road with a short position of Newcrest Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gold Road and Newcrest Mining.
Diversification Opportunities for Gold Road and Newcrest Mining
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Gold and Newcrest is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Gold Road Resources and Newcrest Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Newcrest Mining and Gold Road 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 Gold Road Resources are associated (or correlated) with Newcrest Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Newcrest Mining has no effect on the direction of Gold Road i.e., Gold Road and Newcrest Mining go up and down completely randomly.
Pair Corralation between Gold Road and Newcrest Mining
If you would invest 99.00 in Gold Road Resources on January 20, 2024 and sell it today you would earn a total of 6.00 from holding Gold Road Resources or generate 6.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Gold Road Resources vs. Newcrest Mining
Performance |
| Timeline |
| Gold Road Resources |
| Newcrest Mining |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Gold Road and Newcrest Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gold Road and Newcrest Mining
The main advantage of trading using opposite Gold Road and Newcrest Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gold Road position performs unexpectedly, Newcrest Mining 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 Newcrest Mining will offset losses from the drop in Newcrest Mining's long position.| Gold Road vs. Osisko Mining | Gold Road vs. Almadex Minerals | Gold Road vs. Galiano Gold | Gold Road vs. US Gold Corp |
| Newcrest Mining vs. Wesdome Gold Mines | Newcrest Mining vs. Gold Reserve | Newcrest Mining vs. Osisko Gold Ro | Newcrest Mining vs. I 80 Gold 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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