Correlation Between Coeur Mining and Hochschild Mining

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

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

Diversification Opportunities for Coeur Mining and Hochschild Mining

0.44

Correlation Coefficient

Coeur Mining  Hochschild Mining

Very weak diversification

The 3 months correlation between Coeur and Hochschild is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Coeur Mining and Hochschild Mining plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hochschild Mining plc 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 Hochschild Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hochschild Mining plc has no effect on the direction of Coeur Mining i.e., Coeur Mining and Hochschild Mining go up and down completely randomly.

Pair Corralation between Coeur Mining and Hochschild Mining

Assuming the 90 days trading horizon Coeur Mining is expected to generate 1.55 times less return on investment than Hochschild Mining. In addition to that, Coeur Mining is 1.31 times more volatile than Hochschild Mining plc. It trades about 0.04 of its total potential returns per unit of risk. Hochschild Mining plc is currently generating about 0.08 per unit of volatility. If you would invest  8,060  in Hochschild Mining plc on October 11, 2024 and sell it today you would earn a total of  14,140  from holding Hochschild Mining plc or generate 175.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	99.0%
Values	Daily Returns

Coeur Mining  vs.  Hochschild Mining plc

Coeur Mining

Risk-Adjusted Performance

0 of 100

Very Weak

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

Hochschild Mining plc

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Hochschild Mining plc are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Hochschild Mining may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Coeur Mining and Hochschild Mining

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

The idea behind Coeur Mining and Hochschild Mining plc 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.