Correlation Between Emerald Resources and Coeur Mining
Can any of the company-specific risk be diversified away by investing in both Emerald Resources 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 Emerald Resources and Coeur Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Emerald Resources NL and Coeur Mining, you can compare the effects of market volatilities on Emerald Resources 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 Emerald Resources with a short position of Coeur Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Emerald Resources and Coeur Mining.
Diversification Opportunities for Emerald Resources and Coeur Mining
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Emerald and Coeur is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Emerald Resources NL and Coeur Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coeur Mining and Emerald Resources 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 Emerald Resources NL 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 Emerald Resources i.e., Emerald Resources and Coeur Mining go up and down completely randomly.
Pair Corralation between Emerald Resources and Coeur Mining
Assuming the 90 days horizon Emerald Resources NL is expected to generate 1.26 times more return on investment than Coeur Mining. However, Emerald Resources is 1.26 times more volatile than Coeur Mining. It trades about 0.07 of its potential returns per unit of risk. Coeur Mining is currently generating about 0.05 per unit of risk. If you would invest 101.00 in Emerald Resources NL on August 27, 2024 and sell it today you would earn a total of 84.00 from holding Emerald Resources NL or generate 83.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 62.42% |
| Values | Daily Returns |
Emerald Resources NL vs. Coeur Mining
Performance |
| Timeline |
| Emerald Resources |
| Coeur Mining |
Emerald Resources and Coeur Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Emerald Resources and Coeur Mining
The main advantage of trading using opposite Emerald Resources and Coeur Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Emerald Resources 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.| Emerald Resources vs. Coeur Mining | Emerald Resources vs. Equinox Gold Corp | Emerald Resources vs. B2Gold Corp | Emerald Resources vs. Sandstorm Gold Ltd |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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