Correlation Between McEwen Mining and Zurich Insurance
Can any of the company-specific risk be diversified away by investing in both McEwen Mining and Zurich Insurance 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 Zurich Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between McEwen Mining and Zurich Insurance Group, you can compare the effects of market volatilities on McEwen Mining and Zurich Insurance 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 Zurich Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of McEwen Mining and Zurich Insurance.
Diversification Opportunities for McEwen Mining and Zurich Insurance
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between McEwen and Zurich is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding McEwen Mining and Zurich Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zurich Insurance 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 Zurich Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zurich Insurance has no effect on the direction of McEwen Mining i.e., McEwen Mining and Zurich Insurance go up and down completely randomly.
Pair Corralation between McEwen Mining and Zurich Insurance
Assuming the 90 days trading horizon McEwen Mining is expected to generate 4.24 times more return on investment than Zurich Insurance. However, McEwen Mining is 4.24 times more volatile than Zurich Insurance Group. It trades about 0.11 of its potential returns per unit of risk. Zurich Insurance Group is currently generating about 0.32 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 62.00 from holding McEwen Mining or generate 7.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
McEwen Mining vs. Zurich Insurance Group
Performance |
| Timeline |
| McEwen Mining |
| Zurich Insurance |
McEwen Mining and Zurich Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with McEwen Mining and Zurich Insurance
The main advantage of trading using opposite McEwen Mining and Zurich Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if McEwen Mining position performs unexpectedly, Zurich Insurance 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 Zurich Insurance will offset losses from the drop in Zurich Insurance'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 |
| Zurich Insurance vs. British American Tobacco | Zurich Insurance vs. Ecofin Global Utilities | Zurich Insurance vs. Verizon Communications | Zurich Insurance vs. Ally Financial |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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