Correlation Between Centerra Gold and SSR Mining
Can any of the company-specific risk be diversified away by investing in both Centerra Gold and SSR 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 Centerra Gold and SSR Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Centerra Gold and SSR Mining, you can compare the effects of market volatilities on Centerra Gold and SSR 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 Centerra Gold with a short position of SSR Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centerra Gold and SSR Mining.
Diversification Opportunities for Centerra Gold and SSR Mining
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Centerra and SSR is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Centerra Gold and SSR Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SSR Mining and Centerra Gold 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 Centerra Gold are associated (or correlated) with SSR Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SSR Mining has no effect on the direction of Centerra Gold i.e., Centerra Gold and SSR Mining go up and down completely randomly.
Pair Corralation between Centerra Gold and SSR Mining
Given the investment horizon of 90 days Centerra Gold is expected to generate 0.75 times more return on investment than SSR Mining. However, Centerra Gold is 1.33 times less risky than SSR Mining. It trades about 0.03 of its potential returns per unit of risk. SSR Mining is currently generating about -0.03 per unit of risk. If you would invest 481.00 in Centerra Gold on August 24, 2024 and sell it today you would earn a total of 143.00 from holding Centerra Gold or generate 29.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Centerra Gold vs. SSR Mining
Performance |
| Timeline |
| Centerra Gold |
| SSR Mining |
Centerra Gold and SSR Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centerra Gold and SSR Mining
The main advantage of trading using opposite Centerra Gold and SSR Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centerra Gold position performs unexpectedly, SSR 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 SSR Mining will offset losses from the drop in SSR Mining's long position.| Centerra Gold vs. Gold Fields Ltd | Centerra Gold vs. Eldorado Gold Corp | Centerra Gold vs. Osisko Gold Ro | Centerra Gold vs. SSR Mining |
| SSR Mining vs. Centerra Gold | SSR Mining vs. Gold Fields Ltd | SSR Mining vs. Eldorado Gold Corp | SSR Mining vs. Osisko Gold Ro |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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