Correlation Between Newmont Goldcorp and Polyus PAO

Can any of the company-specific risk be diversified away by investing in both Newmont Goldcorp and Polyus PAO 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 Polyus PAO 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 Polyus PAO ADR, you can compare the effects of market volatilities on Newmont Goldcorp and Polyus PAO 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 Polyus PAO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newmont Goldcorp and Polyus PAO.

Diversification Opportunities for Newmont Goldcorp and Polyus PAO

0.0

Correlation Coefficient

Newmont Goldcorp  Polyus PAO

Pay attention - limited upside

The 3 months correlation between Newmont and Polyus is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Newmont Goldcorp Corp and Polyus PAO ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polyus PAO ADR 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 Polyus PAO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polyus PAO ADR has no effect on the direction of Newmont Goldcorp i.e., Newmont Goldcorp and Polyus PAO go up and down completely randomly.

Pair Corralation between Newmont Goldcorp and Polyus PAO

If you would invest  3,392  in Newmont Goldcorp Corp on January 25, 2024 and sell it today you would earn a total of  468.00  from holding Newmont Goldcorp Corp or generate 13.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	4.55%
Values	Daily Returns

Newmont Goldcorp Corp  vs.  Polyus PAO ADR

Newmont Goldcorp Corp

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Newmont Goldcorp Corp are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady technical and fundamental indicators, Newmont Goldcorp may actually be approaching a critical reversion point that can send shares even higher in May 2024.

Polyus PAO ADR

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Polyus PAO ADR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong technical and fundamental indicators, Polyus PAO is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Newmont Goldcorp and Polyus PAO

The main advantage of trading using opposite Newmont Goldcorp and Polyus PAO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Newmont Goldcorp position performs unexpectedly, Polyus PAO 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 Polyus PAO will offset losses from the drop in Polyus PAO's long position.

The idea behind Newmont Goldcorp Corp and Polyus PAO ADR pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.