Correlation Between McEwen Mining and Federal Realty
Can any of the company-specific risk be diversified away by investing in both McEwen Mining and Federal Realty 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 Federal Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between McEwen Mining and Federal Realty Investment, you can compare the effects of market volatilities on McEwen Mining and Federal Realty 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 Federal Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of McEwen Mining and Federal Realty.
Diversification Opportunities for McEwen Mining and Federal Realty
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between McEwen and Federal is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding McEwen Mining and Federal Realty Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federal Realty Investment 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 Federal Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federal Realty Investment has no effect on the direction of McEwen Mining i.e., McEwen Mining and Federal Realty go up and down completely randomly.
Pair Corralation between McEwen Mining and Federal Realty
Assuming the 90 days trading horizon McEwen Mining is expected to generate 3.65 times more return on investment than Federal Realty. However, McEwen Mining is 3.65 times more volatile than Federal Realty Investment. It trades about 0.16 of its potential returns per unit of risk. Federal Realty Investment is currently generating about -0.06 per unit of risk. If you would invest 810.00 in McEwen Mining on September 13, 2024 and sell it today you would earn a total of 93.00 from holding McEwen Mining or generate 11.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
McEwen Mining vs. Federal Realty Investment
Performance |
| Timeline |
| McEwen Mining |
| Federal Realty Investment |
McEwen Mining and Federal Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with McEwen Mining and Federal Realty
The main advantage of trading using opposite McEwen Mining and Federal Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if McEwen Mining position performs unexpectedly, Federal Realty 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 Federal Realty will offset losses from the drop in Federal Realty's long position.| McEwen Mining vs. Samsung Electronics Co | McEwen Mining vs. Samsung Electronics Co | McEwen Mining vs. Hyundai Motor | McEwen Mining vs. Reliance Industries Ltd |
| Federal Realty vs. Live Nation Entertainment | Federal Realty vs. XLMedia PLC | Federal Realty vs. Zinc Media Group | Federal Realty vs. Hollywood Bowl Group |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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