Correlation Between VIENNA INSURANCE and Newmont

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

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

Diversification Opportunities for VIENNA INSURANCE and Newmont

0.42

Correlation Coefficient

VIENNA INSURANCE  Newmont

Very weak diversification

The 3 months correlation between VIENNA and Newmont is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding VIENNA INSURANCE GR and Newmont in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Newmont and VIENNA INSURANCE 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 VIENNA INSURANCE GR 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 VIENNA INSURANCE i.e., VIENNA INSURANCE and Newmont go up and down completely randomly.

Pair Corralation between VIENNA INSURANCE and Newmont

Assuming the 90 days trading horizon VIENNA INSURANCE GR is expected to generate 0.56 times more return on investment than Newmont. However, VIENNA INSURANCE GR is 1.77 times less risky than Newmont. It trades about 0.39 of its potential returns per unit of risk. Newmont is currently generating about 0.16 per unit of risk. If you would invest  3,015  in VIENNA INSURANCE GR on December 22, 2024 and sell it today you would earn a total of  940.00  from holding VIENNA INSURANCE GR or generate 31.18% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.36%
Values	Daily Returns

VIENNA INSURANCE GR  vs.  Newmont

VIENNA INSURANCE

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in VIENNA INSURANCE GR are ranked lower than 30 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, VIENNA INSURANCE unveiled solid returns over the last few months and may actually be approaching a breakup point.

Newmont

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Newmont are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat fragile primary indicators, Newmont sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with VIENNA INSURANCE and Newmont

The main advantage of trading using opposite VIENNA INSURANCE and Newmont positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VIENNA INSURANCE 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 VIENNA INSURANCE GR 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 Transaction History module to view history of all your transactions and understand their impact on performance.