Correlation Between Deutsche Wohnen and Coeur Mining
Can any of the company-specific risk be diversified away by investing in both Deutsche Wohnen 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 Deutsche Wohnen and Coeur Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Deutsche Wohnen SE and Coeur Mining, you can compare the effects of market volatilities on Deutsche Wohnen 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 Deutsche Wohnen with a short position of Coeur Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deutsche Wohnen and Coeur Mining.
Diversification Opportunities for Deutsche Wohnen and Coeur Mining
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Deutsche and Coeur is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Wohnen SE and Coeur Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coeur Mining and Deutsche Wohnen 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 Deutsche Wohnen SE 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 Deutsche Wohnen i.e., Deutsche Wohnen and Coeur Mining go up and down completely randomly.
Pair Corralation between Deutsche Wohnen and Coeur Mining
Assuming the 90 days trading horizon Deutsche Wohnen is expected to generate 1.08 times less return on investment than Coeur Mining. In addition to that, Deutsche Wohnen is 1.69 times more volatile than Coeur Mining. It trades about 0.03 of its total potential returns per unit of risk. Coeur Mining is currently generating about 0.05 per unit of volatility. If you would invest 356.00 in Coeur Mining on August 29, 2024 and sell it today you would earn a total of 4.00 from holding Coeur Mining or generate 1.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Deutsche Wohnen SE vs. Coeur Mining
Performance |
| Timeline |
| Deutsche Wohnen SE |
| Coeur Mining |
Deutsche Wohnen and Coeur Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Deutsche Wohnen and Coeur Mining
The main advantage of trading using opposite Deutsche Wohnen and Coeur Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deutsche Wohnen 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.| Deutsche Wohnen vs. Park Hotels Resorts | Deutsche Wohnen vs. Evolution Mining Limited | Deutsche Wohnen vs. SERI INDUSTRIAL EO | Deutsche Wohnen vs. MCEWEN MINING INC |
| Coeur Mining vs. Superior Plus Corp | Coeur Mining vs. NMI Holdings | Coeur Mining vs. Origin Agritech | Coeur Mining vs. SIVERS SEMICONDUCTORS AB |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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