Correlation Between McEwen Mining and Charter Communications
Can any of the company-specific risk be diversified away by investing in both McEwen Mining and Charter Communications 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 Charter Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between McEwen Mining and Charter Communications Cl, you can compare the effects of market volatilities on McEwen Mining and Charter Communications 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 Charter Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of McEwen Mining and Charter Communications.
Diversification Opportunities for McEwen Mining and Charter Communications
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between McEwen and Charter is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding McEwen Mining and Charter Communications Cl in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Charter Communications 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 Charter Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Charter Communications has no effect on the direction of McEwen Mining i.e., McEwen Mining and Charter Communications go up and down completely randomly.
Pair Corralation between McEwen Mining and Charter Communications
Assuming the 90 days trading horizon McEwen Mining is expected to generate 1.5 times more return on investment than Charter Communications. However, McEwen Mining is 1.5 times more volatile than Charter Communications Cl. It trades about 0.13 of its potential returns per unit of risk. Charter Communications Cl is currently generating about -0.09 per unit of risk. If you would invest 829.00 in McEwen Mining on September 12, 2024 and sell it today you would earn a total of 74.00 from holding McEwen Mining or generate 8.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
McEwen Mining vs. Charter Communications Cl
Performance |
| Timeline |
| McEwen Mining |
| Charter Communications |
McEwen Mining and Charter Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with McEwen Mining and Charter Communications
The main advantage of trading using opposite McEwen Mining and Charter Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if McEwen Mining position performs unexpectedly, Charter Communications 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 Charter Communications will offset losses from the drop in Charter Communications' long position.| McEwen Mining vs. Impax Environmental Markets | McEwen Mining vs. Amedeo Air Four | McEwen Mining vs. Sealed Air Corp | McEwen Mining vs. Flow Traders NV |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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