Correlation Between MidCap Financial and Coeur Mining
Can any of the company-specific risk be diversified away by investing in both MidCap Financial 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 MidCap Financial and Coeur Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MidCap Financial Investment and Coeur Mining, you can compare the effects of market volatilities on MidCap Financial 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 MidCap Financial with a short position of Coeur Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of MidCap Financial and Coeur Mining.
Diversification Opportunities for MidCap Financial and Coeur Mining
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between MidCap and Coeur is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding MidCap Financial Investment and Coeur Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coeur Mining and MidCap Financial 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 MidCap Financial 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 MidCap Financial i.e., MidCap Financial and Coeur Mining go up and down completely randomly.
Pair Corralation between MidCap Financial and Coeur Mining
Assuming the 90 days trading horizon MidCap Financial Investment is expected to generate 1.8 times more return on investment than Coeur Mining. However, MidCap Financial is 1.8 times more volatile than Coeur Mining. It trades about 0.11 of its potential returns per unit of risk. Coeur Mining is currently generating about -0.04 per unit of risk. If you would invest 1,320 in MidCap Financial Investment on November 3, 2024 and sell it today you would earn a total of 34.00 from holding MidCap Financial Investment or generate 2.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MidCap Financial Investment vs. Coeur Mining
Performance |
| Timeline |
| MidCap Financial Inv |
| Coeur Mining |
MidCap Financial and Coeur Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MidCap Financial and Coeur Mining
The main advantage of trading using opposite MidCap Financial and Coeur Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MidCap Financial 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.| MidCap Financial vs. SIVERS SEMICONDUCTORS AB | MidCap Financial vs. NorAm Drilling AS | MidCap Financial vs. Volkswagen AG | MidCap Financial vs. Darden Restaurants |
| Coeur Mining vs. Guidewire Software | Coeur Mining vs. Unity Software | Coeur Mining vs. CyberArk Software | Coeur Mining vs. Alfa Financial Software |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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