Correlation Between COEUR MINING and Luckin Coffee

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

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

Diversification Opportunities for COEUR MINING and Luckin Coffee

0.0

Correlation Coefficient

COEUR MINING  Luckin Coffee

Pay attention - limited upside

The 3 months correlation between COEUR and Luckin is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding COEUR MINING and Luckin Coffee in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Luckin Coffee 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 Luckin Coffee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Luckin Coffee has no effect on the direction of COEUR MINING i.e., COEUR MINING and Luckin Coffee go up and down completely randomly.

Pair Corralation between COEUR MINING and Luckin Coffee

If you would invest  2,240  in Luckin Coffee on December 21, 2024 and sell it today you would earn a total of  920.00  from holding Luckin Coffee or generate 41.07% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

COEUR MINING  vs.  Luckin Coffee

COEUR MINING

Risk-Adjusted Performance

Insignificant

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 technical and 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.

Luckin Coffee

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Luckin Coffee are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Luckin Coffee unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with COEUR MINING and Luckin Coffee

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

The idea behind COEUR MINING and Luckin Coffee 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.