Correlation Between Coeur Mining and Kinross Gold
Can any of the company-specific risk be diversified away by investing in both Coeur Mining and Kinross Gold 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 Kinross Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coeur Mining and Kinross Gold, you can compare the effects of market volatilities on Coeur Mining and Kinross Gold 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 Kinross Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coeur Mining and Kinross Gold.
Diversification Opportunities for Coeur Mining and Kinross Gold
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Coeur and Kinross is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Coeur Mining and Kinross Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinross Gold 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 Kinross Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinross Gold has no effect on the direction of Coeur Mining i.e., Coeur Mining and Kinross Gold go up and down completely randomly.
Pair Corralation between Coeur Mining and Kinross Gold
Considering the 90-day investment horizon Coeur Mining is expected to generate 1.78 times more return on investment than Kinross Gold. However, Coeur Mining is 1.78 times more volatile than Kinross Gold. It trades about 0.1 of its potential returns per unit of risk. Kinross Gold is currently generating about 0.1 per unit of risk. If you would invest 297.00 in Coeur Mining on August 24, 2024 and sell it today you would earn a total of 373.00 from holding Coeur Mining or generate 125.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Coeur Mining vs. Kinross Gold
Performance |
| Timeline |
| Coeur Mining |
| Kinross Gold |
Coeur Mining and Kinross Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coeur Mining and Kinross Gold
The main advantage of trading using opposite Coeur Mining and Kinross Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coeur Mining position performs unexpectedly, Kinross Gold 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 Kinross Gold will offset losses from the drop in Kinross Gold's long position.| Coeur Mining vs. Gold Fields Ltd | Coeur Mining vs. Barrick Gold Corp | Coeur Mining vs. Pan American Silver | Coeur Mining vs. Franco Nevada |
| Kinross Gold vs. Gold Fields Ltd | Kinross Gold vs. Barrick Gold Corp | Kinross Gold vs. Pan American Silver | Kinross Gold vs. Franco Nevada |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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