Correlation Between New Gold and Ivanhoe Mines
Can any of the company-specific risk be diversified away by investing in both New Gold and Ivanhoe Mines 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 New Gold and Ivanhoe Mines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between New Gold and Ivanhoe Mines, you can compare the effects of market volatilities on New Gold and Ivanhoe Mines 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 New Gold with a short position of Ivanhoe Mines. Check out your portfolio center. Please also check ongoing floating volatility patterns of New Gold and Ivanhoe Mines.
Diversification Opportunities for New Gold and Ivanhoe Mines
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between New and Ivanhoe is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding New Gold and Ivanhoe Mines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ivanhoe Mines and New 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 New Gold are associated (or correlated) with Ivanhoe Mines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ivanhoe Mines has no effect on the direction of New Gold i.e., New Gold and Ivanhoe Mines go up and down completely randomly.
Pair Corralation between New Gold and Ivanhoe Mines
Assuming the 90 days trading horizon New Gold is expected to generate 1.1 times more return on investment than Ivanhoe Mines. However, New Gold is 1.1 times more volatile than Ivanhoe Mines. It trades about 0.14 of its potential returns per unit of risk. Ivanhoe Mines is currently generating about 0.06 per unit of risk. If you would invest 759.00 in New Gold on August 21, 2025 and sell it today you would earn a total of 213.00 from holding New Gold or generate 28.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
New Gold vs. Ivanhoe Mines
Performance |
| Timeline |
| New Gold |
| Ivanhoe Mines |
New Gold and Ivanhoe Mines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with New Gold and Ivanhoe Mines
The main advantage of trading using opposite New Gold and Ivanhoe Mines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if New Gold position performs unexpectedly, Ivanhoe Mines 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 Ivanhoe Mines will offset losses from the drop in Ivanhoe Mines' long position.| New Gold vs. B2Gold Corp | New Gold vs. OceanaGold | New Gold vs. Artemis Gold | New Gold vs. Eldorado Gold Corp |
| Ivanhoe Mines vs. Alamos Gold | Ivanhoe Mines vs. Pan American Silver | Ivanhoe Mines vs. Lundin Mining | Ivanhoe Mines vs. Endeavour Mining Corp |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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