Correlation Between Gladstone Investment and MCEWEN MINING
Can any of the company-specific risk be diversified away by investing in both Gladstone Investment and MCEWEN MINING 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 Gladstone Investment and MCEWEN MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gladstone Investment and MCEWEN MINING INC, you can compare the effects of market volatilities on Gladstone Investment and MCEWEN MINING 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 Gladstone Investment with a short position of MCEWEN MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gladstone Investment and MCEWEN MINING.
Diversification Opportunities for Gladstone Investment and MCEWEN MINING
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gladstone and MCEWEN is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Gladstone Investment and MCEWEN MINING INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MCEWEN MINING INC and Gladstone Investment 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 Gladstone Investment are associated (or correlated) with MCEWEN MINING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MCEWEN MINING INC has no effect on the direction of Gladstone Investment i.e., Gladstone Investment and MCEWEN MINING go up and down completely randomly.
Pair Corralation between Gladstone Investment and MCEWEN MINING
Assuming the 90 days horizon Gladstone Investment is expected to generate 0.4 times more return on investment than MCEWEN MINING. However, Gladstone Investment is 2.5 times less risky than MCEWEN MINING. It trades about 0.07 of its potential returns per unit of risk. MCEWEN MINING INC is currently generating about 0.02 per unit of risk. If you would invest 926.00 in Gladstone Investment on August 31, 2024 and sell it today you would earn a total of 375.00 from holding Gladstone Investment or generate 40.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.74% |
| Values | Daily Returns |
Gladstone Investment vs. MCEWEN MINING INC
Performance |
| Timeline |
| Gladstone Investment |
| MCEWEN MINING INC |
Gladstone Investment and MCEWEN MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gladstone Investment and MCEWEN MINING
The main advantage of trading using opposite Gladstone Investment and MCEWEN MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gladstone Investment position performs unexpectedly, MCEWEN MINING 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 MCEWEN MINING will offset losses from the drop in MCEWEN MINING's long position.| Gladstone Investment vs. QUEEN S ROAD | Gladstone Investment vs. Air Transport Services | Gladstone Investment vs. Gold Road Resources | Gladstone Investment vs. GOLD ROAD RES |
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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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