Correlation Between Coeur Mining and Genesco

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

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

Diversification Opportunities for Coeur Mining and Genesco

-0.28

Correlation Coefficient

Coeur Mining  Genesco

Very good diversification

The 3 months correlation between Coeur and Genesco is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Coeur Mining and Genesco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genesco 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 Genesco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genesco has no effect on the direction of Coeur Mining i.e., Coeur Mining and Genesco go up and down completely randomly.

Pair Corralation between Coeur Mining and Genesco

Considering the 90-day investment horizon Coeur Mining is expected to generate 7.23 times less return on investment than Genesco. In addition to that, Coeur Mining is 1.08 times more volatile than Genesco. It trades about 0.03 of its total potential returns per unit of risk. Genesco is currently generating about 0.26 per unit of volatility. If you would invest  2,945  in Genesco on October 7, 2024 and sell it today you would earn a total of  1,324  from holding Genesco or generate 44.96% return on investment over 90 days.

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

Coeur Mining  vs.  Genesco

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 rather sound fundamental indicators, Coeur Mining is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Genesco

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Genesco are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating fundamental indicators, Genesco displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Coeur Mining and Genesco

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

The idea behind Coeur Mining and Genesco 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.