Correlation Between I 80 and Kinross Gold

Can any of the company-specific risk be diversified away by investing in both I 80 and Kinross Gold 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 I 80 and Kinross Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between I 80 Gold Corp and Kinross Gold, you can compare the effects of market volatilities on I 80 and Kinross Gold 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 I 80 with a short position of Kinross Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of I 80 and Kinross Gold.

Diversification Opportunities for I 80 and Kinross Gold

0.29

Correlation Coefficient

I 80  Kinross Gold

Modest diversification

The 3 months correlation between IAUX and Kinross is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding I 80 Gold Corp and Kinross Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinross Gold and I 80 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 I 80 Gold Corp are associated (or correlated) with Kinross Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinross Gold has no effect on the direction of I 80 i.e., I 80 and Kinross Gold go up and down completely randomly.

Pair Corralation between I 80 and Kinross Gold

Given the investment horizon of 90 days I 80 Gold Corp is expected to under-perform the Kinross Gold. In addition to that, I 80 is 1.76 times more volatile than Kinross Gold. It trades about -0.23 of its total potential returns per unit of risk. Kinross Gold is currently generating about -0.14 per unit of volatility. If you would invest  1,008  in Kinross Gold on September 22, 2024 and sell it today you would lose (83.00) from holding Kinross Gold or give up 8.23% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

I 80 Gold Corp  vs.  Kinross Gold

I 80 Gold

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days I 80 Gold Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Kinross Gold

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kinross Gold has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Kinross Gold is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with I 80 and Kinross Gold

The main advantage of trading using opposite I 80 and Kinross Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if I 80 position performs unexpectedly, Kinross Gold 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 Kinross Gold will offset losses from the drop in Kinross Gold's long position.

The idea behind I 80 Gold Corp and Kinross Gold 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.