Correlation Between McEwen Mining and Inspiration Healthcare
Can any of the company-specific risk be diversified away by investing in both McEwen Mining and Inspiration Healthcare 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 Inspiration Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between McEwen Mining and Inspiration Healthcare Group, you can compare the effects of market volatilities on McEwen Mining and Inspiration Healthcare 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 Inspiration Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of McEwen Mining and Inspiration Healthcare.
Diversification Opportunities for McEwen Mining and Inspiration Healthcare
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between McEwen and Inspiration is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding McEwen Mining and Inspiration Healthcare Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inspiration Healthcare 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 Inspiration Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inspiration Healthcare has no effect on the direction of McEwen Mining i.e., McEwen Mining and Inspiration Healthcare go up and down completely randomly.
Pair Corralation between McEwen Mining and Inspiration Healthcare
Assuming the 90 days trading horizon McEwen Mining is expected to generate 1.47 times more return on investment than Inspiration Healthcare. However, McEwen Mining is 1.47 times more volatile than Inspiration Healthcare Group. It trades about 0.05 of its potential returns per unit of risk. Inspiration Healthcare Group is currently generating about -0.3 per unit of risk. If you would invest 854.00 in McEwen Mining on September 4, 2024 and sell it today you would earn a total of 58.00 from holding McEwen Mining or generate 6.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
McEwen Mining vs. Inspiration Healthcare Group
Performance |
| Timeline |
| McEwen Mining |
| Inspiration Healthcare |
McEwen Mining and Inspiration Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with McEwen Mining and Inspiration Healthcare
The main advantage of trading using opposite McEwen Mining and Inspiration Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if McEwen Mining position performs unexpectedly, Inspiration Healthcare 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 Inspiration Healthcare will offset losses from the drop in Inspiration Healthcare's long position.| McEwen Mining vs. Zegona Communications Plc | McEwen Mining vs. Associated British Foods | McEwen Mining vs. Tyson Foods Cl | McEwen Mining vs. Zoom Video Communications |
| Inspiration Healthcare vs. AMG Advanced Metallurgical | Inspiration Healthcare vs. Hochschild Mining plc | Inspiration Healthcare vs. McEwen Mining | Inspiration Healthcare vs. Virgin Wines UK |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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