Correlation Between Coeur Mining and Northern Star
Can any of the company-specific risk be diversified away by investing in both Coeur Mining and Northern Star 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 Northern Star into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coeur Mining and Northern Star Resources, you can compare the effects of market volatilities on Coeur Mining and Northern Star 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 Northern Star. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coeur Mining and Northern Star.
Diversification Opportunities for Coeur Mining and Northern Star
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Coeur and Northern is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Coeur Mining and Northern Star Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Northern Star Resources 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 Northern Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Northern Star Resources has no effect on the direction of Coeur Mining i.e., Coeur Mining and Northern Star go up and down completely randomly.
Pair Corralation between Coeur Mining and Northern Star
Considering the 90-day investment horizon Coeur Mining is expected to generate 1.01 times less return on investment than Northern Star. But when comparing it to its historical volatility, Coeur Mining is 1.46 times less risky than Northern Star. It trades about 0.12 of its potential returns per unit of risk. Northern Star Resources is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 971.00 in Northern Star Resources on October 20, 2024 and sell it today you would earn a total of 54.00 from holding Northern Star Resources or generate 5.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Coeur Mining vs. Northern Star Resources
Performance |
| Timeline |
| Coeur Mining |
| Northern Star Resources |
Coeur Mining and Northern Star Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coeur Mining and Northern Star
The main advantage of trading using opposite Coeur Mining and Northern Star positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coeur Mining position performs unexpectedly, Northern Star 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 Northern Star will offset losses from the drop in Northern Star's long position.| Coeur Mining vs. Equinox Gold Corp | Coeur Mining vs. B2Gold Corp | Coeur Mining vs. Sandstorm Gold Ltd | Coeur Mining vs. Pan American Silver |
| Northern Star vs. Regis Resources | Northern Star vs. West African Resources | Northern Star vs. Dundee Precious Metals | Northern Star vs. Maple Gold Mines |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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