Correlation Between C2C Gold and Newmont Goldcorp

Can any of the company-specific risk be diversified away by investing in both C2C Gold 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 C2C Gold and Newmont Goldcorp into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between C2C Gold Corp and Newmont Goldcorp Corp, you can compare the effects of market volatilities on C2C Gold 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 C2C Gold with a short position of Newmont Goldcorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of C2C Gold and Newmont Goldcorp.

Diversification Opportunities for C2C Gold and Newmont Goldcorp

-0.01

Correlation Coefficient

C2C Gold  Newmont Goldcorp

Good diversification

The 3 months correlation between C2C and Newmont is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding C2C Gold Corp 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 C2C Gold 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 C2C Gold Corp 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 C2C Gold i.e., C2C Gold and Newmont Goldcorp go up and down completely randomly.

Pair Corralation between C2C Gold and Newmont Goldcorp

Assuming the 90 days horizon C2C Gold is expected to generate 2.63 times less return on investment than Newmont Goldcorp. In addition to that, C2C Gold is 2.49 times more volatile than Newmont Goldcorp Corp. It trades about 0.03 of its total potential returns per unit of risk. Newmont Goldcorp Corp is currently generating about 0.23 per unit of volatility. If you would invest  3,680  in Newmont Goldcorp Corp on December 19, 2024 and sell it today you would earn a total of  1,119  from holding Newmont Goldcorp Corp or generate 30.41% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	41.67%
Values	Daily Returns

C2C Gold Corp  vs.  Newmont Goldcorp Corp

C2C Gold Corp

Risk-Adjusted Performance

Weak

Over the last 90 days C2C Gold Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly fragile technical and fundamental indicators, C2C Gold may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Newmont Goldcorp Corp

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Newmont Goldcorp Corp are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain technical and fundamental indicators, Newmont Goldcorp displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with C2C Gold and Newmont Goldcorp

The main advantage of trading using opposite C2C Gold and Newmont Goldcorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if C2C Gold 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.

The idea behind C2C Gold Corp and Newmont Goldcorp Corp 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.

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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.