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Renaissance Technologies' Exposure to Coeur Mining (Continued from Prior Part) Betting on Coeur Mining
The main reason behind investing in a stock over a benchmark—for example, engaging in active investing over mere replication of a benchmark portfolio—is to earn excess returns. In the case of Renaissance Technologies, by increasing its stake in Coeur Mining (CDE) in 1Q15, it would expect Coeur Mining to generate superior returns compared to the benchmarks listed below.
As observed above, Coeur Mining underperformed its peers. So far, in 2015, it generated 6.65% returns to its shareholders. Meanwhile, Newmont Mining (NEM), Hecla Mining (HL), and Pan American Silver (PAAS) yielded returns of ~43%, 15%, and 8% respectively.
Is the Gamble Worth it?
The previously mentioned trend doesn’t hold true when Coeur Mining is compared to ETFs with exposure to gold and silver mining stocks. ETFs like the Market Vectors Gold Miners Index (GDX) yielded returns of 3.47%, while the SPDR S&P Metals and Mining ETF (XME) yielded negative returns of 9.45%.
As a result, it may appear that investing in Coeur Mining is a superior strategy compared to taking a more passive stance. In comparison to its peers, its performance is lagging. However, Coeur Mining could gain from falling oil prices and the depreciation of the Mexican peso. For this reason, Renaissance Technologies’ trade doesn’t seem to be timed wrong.
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Coeur d'Alene Mines Corporation
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PRODUCER |
CODE : CDE |
ISIN : US1921085049 |
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ProfileMarket IndicatorsVALUE : Projects & res.Press releasesAnnual reportRISK : Asset profileContact Cpy |
Coeur d'Alène is a silver and gold producing company based in United states of america. Coeur d'Alène produces silver, gold, copper, lead and zinc in Argentina, in Australia, in Bolivia, in Mexico and in USA, develops gold and silver in Argentina and in Bolivia, and holds various exploration projects in Mexico. Its main assets in production are ROCHESTER MINE - NEVADA PACKARD in USA, ENDEAVOR and BROKEN HILL in Australia, PALMAREJO in Mexico, MARTHA MINE in Argentina and SAN BARTOLOME in Bolivia, its main assets in development are ROCHESTER and KENSINGTON in Bolivia and JOAQUIN in Argentina and its main exploration properties are KENSINGTON/JUALIN in Argentina, LAKE VICTORIA GOLD BELT in Tanzania and EL REALITO, GUADALUPE and LA PATRIA in Mexico. Coeur d'Alène is listed in Canada, in Germany and in United States of America. Its market capitalisation is US$ 821.5 millions as of today (€ 719.6 millions). Its stock quote reached its highest recent level on November 21, 1997 at US$ 99.38, and its lowest recent point on January 22, 2016 at US$ 1.62. Coeur d'Alène has 185 442 526 shares outstanding. |