Correlation Between INTERSHOP Communications and Newmont

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

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

Diversification Opportunities for INTERSHOP Communications and Newmont

-0.43

Correlation Coefficient

INTERSHOP Communications  Newmont

Very good diversification

The 3 months correlation between INTERSHOP and Newmont is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding INTERSHOP Communications Aktie and Newmont in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Newmont and INTERSHOP Communications 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 INTERSHOP Communications Aktiengesellschaft are associated (or correlated) with Newmont. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Newmont has no effect on the direction of INTERSHOP Communications i.e., INTERSHOP Communications and Newmont go up and down completely randomly.

Pair Corralation between INTERSHOP Communications and Newmont

Assuming the 90 days trading horizon INTERSHOP Communications Aktiengesellschaft is expected to under-perform the Newmont. In addition to that, INTERSHOP Communications is 1.33 times more volatile than Newmont. It trades about -0.02 of its total potential returns per unit of risk. Newmont is currently generating about -0.01 per unit of volatility. If you would invest  4,479  in Newmont on October 10, 2024 and sell it today you would lose (796.00) from holding Newmont or give up 17.77% of portfolio value over 90 days.

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

INTERSHOP Communications Aktie  vs.  Newmont

INTERSHOP Communications

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in INTERSHOP Communications Aktiengesellschaft are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, INTERSHOP Communications may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Newmont

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Newmont has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's primary indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with INTERSHOP Communications and Newmont

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

The idea behind INTERSHOP Communications Aktiengesellschaft and Newmont 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.