Correlation Between Coeur Mining and DS Smith
Can any of the company-specific risk be diversified away by investing in both Coeur Mining and DS Smith 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 Coeur Mining and DS Smith into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coeur Mining and DS Smith PLC, you can compare the effects of market volatilities on Coeur Mining and DS Smith 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 Coeur Mining with a short position of DS Smith. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coeur Mining and DS Smith.
Diversification Opportunities for Coeur Mining and DS Smith
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Coeur and SMDS is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Coeur Mining and DS Smith PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DS Smith PLC and Coeur Mining 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 Coeur Mining are associated (or correlated) with DS Smith. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DS Smith PLC has no effect on the direction of Coeur Mining i.e., Coeur Mining and DS Smith go up and down completely randomly.
Pair Corralation between Coeur Mining and DS Smith
Assuming the 90 days trading horizon Coeur Mining is expected to generate 3.43 times more return on investment than DS Smith. However, Coeur Mining is 3.43 times more volatile than DS Smith PLC. It trades about 0.02 of its potential returns per unit of risk. DS Smith PLC is currently generating about -0.01 per unit of risk. If you would invest 627.00 in Coeur Mining on October 11, 2024 and sell it today you would lose (1.00) from holding Coeur Mining or give up 0.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.56% |
| Values | Daily Returns |
Coeur Mining vs. DS Smith PLC
Performance |
| Timeline |
| Coeur Mining |
| DS Smith PLC |
Coeur Mining and DS Smith Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coeur Mining and DS Smith
The main advantage of trading using opposite Coeur Mining and DS Smith positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coeur Mining position performs unexpectedly, DS Smith 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 DS Smith will offset losses from the drop in DS Smith's long position.| Coeur Mining vs. Cornish Metals | Coeur Mining vs. Wheaton Precious Metals | Coeur Mining vs. Atalaya Mining | Coeur Mining vs. Thor Mining PLC |
| DS Smith vs. Coeur Mining | DS Smith vs. Spotify Technology SA | DS Smith vs. Europa Metals | DS Smith vs. Axway Software SA |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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