Correlation Between Federal Realty and Coeur Mining
Can any of the company-specific risk be diversified away by investing in both Federal Realty and Coeur Mining 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 Federal Realty and Coeur Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federal Realty Investment and Coeur Mining, you can compare the effects of market volatilities on Federal Realty and Coeur Mining 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 Federal Realty with a short position of Coeur Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federal Realty and Coeur Mining.
Diversification Opportunities for Federal Realty and Coeur Mining
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Federal and Coeur is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Federal Realty Investment and Coeur Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coeur Mining and Federal Realty 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 Federal Realty Investment are associated (or correlated) with Coeur Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coeur Mining has no effect on the direction of Federal Realty i.e., Federal Realty and Coeur Mining go up and down completely randomly.
Pair Corralation between Federal Realty and Coeur Mining
Assuming the 90 days trading horizon Federal Realty is expected to generate 5.04 times less return on investment than Coeur Mining. But when comparing it to its historical volatility, Federal Realty Investment is 2.93 times less risky than Coeur Mining. It trades about 0.03 of its potential returns per unit of risk. Coeur Mining is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 324.00 in Coeur Mining on August 27, 2024 and sell it today you would earn a total of 345.00 from holding Coeur Mining or generate 106.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 92.81% |
| Values | Daily Returns |
Federal Realty Investment vs. Coeur Mining
Performance |
| Timeline |
| Federal Realty Investment |
| Coeur Mining |
Federal Realty and Coeur Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federal Realty and Coeur Mining
The main advantage of trading using opposite Federal Realty and Coeur Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federal Realty position performs unexpectedly, Coeur Mining 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 Coeur Mining will offset losses from the drop in Coeur Mining's long position.| Federal Realty vs. Adriatic Metals | Federal Realty vs. Aeorema Communications Plc | Federal Realty vs. Empire Metals Limited | Federal Realty vs. Gaztransport et Technigaz |
| Coeur Mining vs. Samsung Electronics Co | Coeur Mining vs. Samsung Electronics Co | Coeur Mining vs. Hyundai Motor | Coeur Mining vs. Toyota Motor 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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