Correlation Between CHEVRON CDR and SSR Mining
Can any of the company-specific risk be diversified away by investing in both CHEVRON CDR 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 CHEVRON CDR and SSR Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CHEVRON CDR and SSR Mining, you can compare the effects of market volatilities on CHEVRON CDR 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 CHEVRON CDR with a short position of SSR Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHEVRON CDR and SSR Mining.
Diversification Opportunities for CHEVRON CDR and SSR Mining
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between CHEVRON and SSR is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding CHEVRON CDR and SSR Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SSR Mining and CHEVRON CDR 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 CHEVRON CDR 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 CHEVRON CDR i.e., CHEVRON CDR and SSR Mining go up and down completely randomly.
Pair Corralation between CHEVRON CDR and SSR Mining
Assuming the 90 days trading horizon CHEVRON CDR is expected to generate 2.67 times less return on investment than SSR Mining. But when comparing it to its historical volatility, CHEVRON CDR is 2.21 times less risky than SSR Mining. It trades about 0.1 of its potential returns per unit of risk. SSR Mining is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 1,429 in SSR Mining on April 24, 2025 and sell it today you would earn a total of 321.00 from holding SSR Mining or generate 22.46% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
CHEVRON CDR vs. SSR Mining
Performance |
Timeline |
CHEVRON CDR |
SSR Mining |
CHEVRON CDR and SSR Mining Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CHEVRON CDR and SSR Mining
The main advantage of trading using opposite CHEVRON CDR and SSR Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CHEVRON CDR 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.CHEVRON CDR vs. Canadian Imperial Bank | CHEVRON CDR vs. Algoma Steel Group | CHEVRON CDR vs. Wall Financial | CHEVRON CDR vs. Champion Iron |
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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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