Correlation Between Coeur Mining and Prudential Financial

Can any of the company-specific risk be diversified away by investing in both Coeur Mining and Prudential Financial 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 Prudential Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Coeur Mining and Prudential Financial, you can compare the effects of market volatilities on Coeur Mining and Prudential Financial 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 Prudential Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coeur Mining and Prudential Financial.

Diversification Opportunities for Coeur Mining and Prudential Financial

0.14

Correlation Coefficient

Coeur Mining  Prudential Financial

Average diversification

The 3 months correlation between Coeur and Prudential is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Coeur Mining and Prudential Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prudential Financial 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 Prudential Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prudential Financial has no effect on the direction of Coeur Mining i.e., Coeur Mining and Prudential Financial go up and down completely randomly.

Pair Corralation between Coeur Mining and Prudential Financial

Assuming the 90 days trading horizon Coeur Mining is expected to generate 2.35 times more return on investment than Prudential Financial. However, Coeur Mining is 2.35 times more volatile than Prudential Financial. It trades about 0.05 of its potential returns per unit of risk. Prudential Financial is currently generating about -0.03 per unit of risk. If you would invest  590.00  in Coeur Mining on December 25, 2024 and sell it today you would earn a total of  46.00  from holding Coeur Mining or generate 7.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Coeur Mining  vs.  Prudential Financial

Coeur Mining

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Coeur Mining are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Coeur Mining unveiled solid returns over the last few months and may actually be approaching a breakup point.

Prudential Financial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Prudential Financial has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Prudential Financial is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Coeur Mining and Prudential Financial

The main advantage of trading using opposite Coeur Mining and Prudential Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coeur Mining position performs unexpectedly, Prudential Financial 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 Prudential Financial will offset losses from the drop in Prudential Financial's long position.

The idea behind Coeur Mining and Prudential Financial pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.