Correlation Between McEwen Mining and Ocean Harvest
Can any of the company-specific risk be diversified away by investing in both McEwen Mining and Ocean Harvest 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 Ocean Harvest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between McEwen Mining and Ocean Harvest Technology, you can compare the effects of market volatilities on McEwen Mining and Ocean Harvest 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 Ocean Harvest. Check out your portfolio center. Please also check ongoing floating volatility patterns of McEwen Mining and Ocean Harvest.
Diversification Opportunities for McEwen Mining and Ocean Harvest
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between McEwen and Ocean is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding McEwen Mining and Ocean Harvest Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ocean Harvest Technology 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 Ocean Harvest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ocean Harvest Technology has no effect on the direction of McEwen Mining i.e., McEwen Mining and Ocean Harvest go up and down completely randomly.
Pair Corralation between McEwen Mining and Ocean Harvest
Assuming the 90 days trading horizon McEwen Mining is expected to generate 1.08 times more return on investment than Ocean Harvest. However, McEwen Mining is 1.08 times more volatile than Ocean Harvest Technology. It trades about 0.03 of its potential returns per unit of risk. Ocean Harvest Technology is currently generating about -0.03 per unit of risk. If you would invest 720.00 in McEwen Mining on August 31, 2024 and sell it today you would earn a total of 103.00 from holding McEwen Mining or generate 14.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 87.11% |
| Values | Daily Returns |
McEwen Mining vs. Ocean Harvest Technology
Performance |
| Timeline |
| McEwen Mining |
| Ocean Harvest Technology |
McEwen Mining and Ocean Harvest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with McEwen Mining and Ocean Harvest
The main advantage of trading using opposite McEwen Mining and Ocean Harvest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if McEwen Mining position performs unexpectedly, Ocean Harvest 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 Ocean Harvest will offset losses from the drop in Ocean Harvest's long position.| McEwen Mining vs. Datalogic | McEwen Mining vs. Federal Realty Investment | McEwen Mining vs. Bankers Investment Trust | McEwen Mining vs. Automatic Data Processing |
| Ocean Harvest vs. Quadrise Plc | Ocean Harvest vs. ImmuPharma PLC | Ocean Harvest vs. Intuitive Investments Group | Ocean Harvest vs. European Metals Holdings |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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