Correlation Between McEwen Mining and Argentex Group
Can any of the company-specific risk be diversified away by investing in both McEwen Mining and Argentex Group 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 Argentex Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between McEwen Mining and Argentex Group PLC, you can compare the effects of market volatilities on McEwen Mining and Argentex Group 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 Argentex Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of McEwen Mining and Argentex Group.
Diversification Opportunities for McEwen Mining and Argentex Group
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between McEwen and Argentex is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding McEwen Mining and Argentex Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Argentex Group PLC 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 Argentex Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Argentex Group PLC has no effect on the direction of McEwen Mining i.e., McEwen Mining and Argentex Group go up and down completely randomly.
Pair Corralation between McEwen Mining and Argentex Group
Assuming the 90 days trading horizon McEwen Mining is expected to generate 0.95 times more return on investment than Argentex Group. However, McEwen Mining is 1.05 times less risky than Argentex Group. It trades about 0.05 of its potential returns per unit of risk. Argentex Group PLC is currently generating about -0.05 per unit of risk. If you would invest 540.00 in McEwen Mining on September 5, 2024 and sell it today you would earn a total of 372.00 from holding McEwen Mining or generate 68.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
McEwen Mining vs. Argentex Group PLC
Performance |
| Timeline |
| McEwen Mining |
| Argentex Group PLC |
McEwen Mining and Argentex Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with McEwen Mining and Argentex Group
The main advantage of trading using opposite McEwen Mining and Argentex Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if McEwen Mining position performs unexpectedly, Argentex Group 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 Argentex Group will offset losses from the drop in Argentex Group's long position.| McEwen Mining vs. Samsung Electronics Co | McEwen Mining vs. Samsung Electronics Co | McEwen Mining vs. Hyundai Motor | McEwen Mining vs. Toyota Motor Corp |
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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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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