Correlation Between Barrick Gold and ACG Metals

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

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

Diversification Opportunities for Barrick Gold and ACG Metals

0.0

Correlation Coefficient

Barrick Gold  ACG Metals

Pay attention - limited upside

The 3 months correlation between Barrick and ACG is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Barrick Gold Corp and ACG Metals Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ACG Metals Limited and Barrick 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 Barrick Gold Corp are associated (or correlated) with ACG Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ACG Metals Limited has no effect on the direction of Barrick Gold i.e., Barrick Gold and ACG Metals go up and down completely randomly.

Pair Corralation between Barrick Gold and ACG Metals

If you would invest  1,650  in ACG Metals Limited on October 1, 2024 and sell it today you would earn a total of  0.00  from holding ACG Metals Limited or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	45.67%
Values	Daily Returns

Barrick Gold Corp  vs.  ACG Metals Limited

Barrick Gold Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Barrick Gold Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's essential indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

ACG Metals Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ACG Metals Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, ACG Metals is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Barrick Gold and ACG Metals

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

The idea behind Barrick Gold Corp and ACG Metals Limited 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.