Correlation Between Endeavour Mining and Dundee Precious
Can any of the company-specific risk be diversified away by investing in both Endeavour Mining and Dundee Precious 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 Endeavour Mining and Dundee Precious into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Endeavour Mining Corp and Dundee Precious Metals, you can compare the effects of market volatilities on Endeavour Mining and Dundee Precious 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 Endeavour Mining with a short position of Dundee Precious. Check out your portfolio center. Please also check ongoing floating volatility patterns of Endeavour Mining and Dundee Precious.
Diversification Opportunities for Endeavour Mining and Dundee Precious
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Endeavour and Dundee is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Endeavour Mining Corp and Dundee Precious Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dundee Precious Metals and Endeavour 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 Endeavour Mining Corp are associated (or correlated) with Dundee Precious. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dundee Precious Metals has no effect on the direction of Endeavour Mining i.e., Endeavour Mining and Dundee Precious go up and down completely randomly.
Pair Corralation between Endeavour Mining and Dundee Precious
Assuming the 90 days trading horizon Endeavour Mining Corp is expected to under-perform the Dundee Precious. In addition to that, Endeavour Mining is 1.32 times more volatile than Dundee Precious Metals. It trades about -0.24 of its total potential returns per unit of risk. Dundee Precious Metals is currently generating about -0.16 per unit of volatility. If you would invest 1,400 in Dundee Precious Metals on August 29, 2024 and sell it today you would lose (96.00) from holding Dundee Precious Metals or give up 6.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Endeavour Mining Corp vs. Dundee Precious Metals
Performance |
| Timeline |
| Endeavour Mining Corp |
| Dundee Precious Metals |
Endeavour Mining and Dundee Precious Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Endeavour Mining and Dundee Precious
The main advantage of trading using opposite Endeavour Mining and Dundee Precious positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Endeavour Mining position performs unexpectedly, Dundee Precious 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 Dundee Precious will offset losses from the drop in Dundee Precious' long position.| Endeavour Mining vs. SSR Mining | Endeavour Mining vs. Centerra Gold | Endeavour Mining vs. Alamos Gold | Endeavour 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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