Correlation Between Denison Mines and Kinross Gold

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

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

Diversification Opportunities for Denison Mines and Kinross Gold

0.54

Correlation Coefficient

Denison Mines  Kinross Gold

Very weak diversification

The 3 months correlation between Denison and Kinross is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Denison Mines Corp and Kinross Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinross Gold Corp and Denison Mines 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 Denison Mines Corp are associated (or correlated) with Kinross Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinross Gold Corp has no effect on the direction of Denison Mines i.e., Denison Mines and Kinross Gold go up and down completely randomly.

Pair Corralation between Denison Mines and Kinross Gold

Assuming the 90 days trading horizon Denison Mines Corp is expected to generate 1.56 times more return on investment than Kinross Gold. However, Denison Mines is 1.56 times more volatile than Kinross Gold Corp. It trades about 0.21 of its potential returns per unit of risk. Kinross Gold Corp is currently generating about 0.06 per unit of risk. If you would invest  179.00  in Denison Mines Corp on April 22, 2025 and sell it today you would earn a total of  111.00  from holding Denison Mines Corp or generate 62.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.44%
Values	Daily Returns

Denison Mines Corp  vs.  Kinross Gold Corp

Denison Mines Corp

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Denison Mines Corp are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating essential indicators, Denison Mines displayed solid returns over the last few months and may actually be approaching a breakup point.

Kinross Gold Corp

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Kinross Gold Corp are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Kinross Gold may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Denison Mines and Kinross Gold

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

The idea behind Denison Mines Corp and Kinross Gold Corp 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 Transaction History module to view history of all your transactions and understand their impact on performance.