Correlation Between Gold Fields and 79North

Can any of the company-specific risk be diversified away by investing in both Gold Fields and 79North 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 Fields and 79North into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Gold Fields Ltd and 79North, you can compare the effects of market volatilities on Gold Fields and 79North 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 Fields with a short position of 79North. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gold Fields and 79North.

Diversification Opportunities for Gold Fields and 79North

-0.6

Correlation Coefficient

Gold Fields  79North

Excellent diversification

The 3 months correlation between Gold and 79North is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Gold Fields Ltd and 79North in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 79North and Gold Fields 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 Fields Ltd are associated (or correlated) with 79North. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 79North has no effect on the direction of Gold Fields i.e., Gold Fields and 79North go up and down completely randomly.

Pair Corralation between Gold Fields and 79North

If you would invest  1,389  in Gold Fields Ltd on October 7, 2024 and sell it today you would earn a total of  8.00  from holding Gold Fields Ltd or generate 0.58% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	5.0%
Values	Daily Returns

Gold Fields Ltd  vs.  79North

Gold Fields

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gold Fields Ltd has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's technical and fundamental indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

79North

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days 79North has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Gold Fields and 79North

The main advantage of trading using opposite Gold Fields and 79North positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gold Fields position performs unexpectedly, 79North 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 79North will offset losses from the drop in 79North's long position.

The idea behind Gold Fields Ltd and 79North 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.