Correlation Between Endeavour Mining and SSR Mining

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

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

Diversification Opportunities for Endeavour Mining and SSR Mining

0.5

Correlation Coefficient

Endeavour Mining  SSR Mining

Very weak diversification

The 3 months correlation between Endeavour and SSR is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Endeavour Mining Corp and SSR Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SSR Mining and Endeavour 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 Endeavour Mining Corp are associated (or correlated) with SSR Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SSR Mining has no effect on the direction of Endeavour Mining i.e., Endeavour Mining and SSR Mining go up and down completely randomly.

Pair Corralation between Endeavour Mining and SSR Mining

Assuming the 90 days trading horizon Endeavour Mining Corp is expected to under-perform the SSR Mining. But the stock apears to be less risky and, when comparing its historical volatility, Endeavour Mining Corp is 1.77 times less risky than SSR Mining. The stock trades about -0.19 of its potential returns per unit of risk. The SSR Mining is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest  847.00  in SSR Mining on September 5, 2024 and sell it today you would lose (45.00) from holding SSR Mining or give up 5.31% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.65%
Values	Daily Returns

Endeavour Mining Corp  vs.  SSR Mining

Endeavour Mining Corp

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Endeavour Mining Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Endeavour Mining is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

SSR Mining

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SSR Mining are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, SSR Mining displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Endeavour Mining and SSR Mining

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

The idea behind Endeavour Mining Corp and SSR Mining 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.

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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..