Correlation Between McEwen Mining and Skandinaviska Enskilda
Can any of the company-specific risk be diversified away by investing in both McEwen Mining and Skandinaviska Enskilda 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 McEwen Mining and Skandinaviska Enskilda into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between McEwen Mining and Skandinaviska Enskilda Banken, you can compare the effects of market volatilities on McEwen Mining and Skandinaviska Enskilda 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 McEwen Mining with a short position of Skandinaviska Enskilda. Check out your portfolio center. Please also check ongoing floating volatility patterns of McEwen Mining and Skandinaviska Enskilda.
Diversification Opportunities for McEwen Mining and Skandinaviska Enskilda
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between McEwen and Skandinaviska is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding McEwen Mining and Skandinaviska Enskilda Banken in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Skandinaviska Enskilda and McEwen 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 McEwen Mining are associated (or correlated) with Skandinaviska Enskilda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Skandinaviska Enskilda has no effect on the direction of McEwen Mining i.e., McEwen Mining and Skandinaviska Enskilda go up and down completely randomly.
Pair Corralation between McEwen Mining and Skandinaviska Enskilda
Assuming the 90 days trading horizon McEwen Mining is expected to generate 1.94 times more return on investment than Skandinaviska Enskilda. However, McEwen Mining is 1.94 times more volatile than Skandinaviska Enskilda Banken. It trades about 0.04 of its potential returns per unit of risk. Skandinaviska Enskilda Banken is currently generating about 0.03 per unit of risk. If you would invest 615.00 in McEwen Mining on September 14, 2024 and sell it today you would earn a total of 257.00 from holding McEwen Mining or generate 41.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 96.79% |
| Values | Daily Returns |
McEwen Mining vs. Skandinaviska Enskilda Banken
Performance |
| Timeline |
| McEwen Mining |
| Skandinaviska Enskilda |
McEwen Mining and Skandinaviska Enskilda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with McEwen Mining and Skandinaviska Enskilda
The main advantage of trading using opposite McEwen Mining and Skandinaviska Enskilda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if McEwen Mining position performs unexpectedly, Skandinaviska Enskilda 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 Skandinaviska Enskilda will offset losses from the drop in Skandinaviska Enskilda's long position.| McEwen Mining vs. Spirent Communications plc | McEwen Mining vs. Batm Advanced Communications | McEwen Mining vs. Auction Technology Group | McEwen Mining vs. Alfa Financial Software |
| Skandinaviska Enskilda vs. Central Asia Metals | Skandinaviska Enskilda vs. McEwen Mining | Skandinaviska Enskilda vs. METALL ZUG AG | Skandinaviska Enskilda vs. GreenX Metals |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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