Correlation Between ARDAGH METAL and MCEWEN MINING
Can any of the company-specific risk be diversified away by investing in both ARDAGH METAL 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 ARDAGH METAL and MCEWEN MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ARDAGH METAL PACDL 0001 and MCEWEN MINING INC, you can compare the effects of market volatilities on ARDAGH METAL 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 ARDAGH METAL with a short position of MCEWEN MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of ARDAGH METAL and MCEWEN MINING.
Diversification Opportunities for ARDAGH METAL and MCEWEN MINING
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ARDAGH and MCEWEN is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding ARDAGH METAL PACDL 0001 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 ARDAGH METAL 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 ARDAGH METAL PACDL 0001 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 ARDAGH METAL i.e., ARDAGH METAL and MCEWEN MINING go up and down completely randomly.
Pair Corralation between ARDAGH METAL and MCEWEN MINING
Assuming the 90 days horizon ARDAGH METAL PACDL 0001 is expected to generate 0.9 times more return on investment than MCEWEN MINING. However, ARDAGH METAL PACDL 0001 is 1.11 times less risky than MCEWEN MINING. It trades about 0.03 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 287.00 in ARDAGH METAL PACDL 0001 on August 31, 2024 and sell it today you would earn a total of 55.00 from holding ARDAGH METAL PACDL 0001 or generate 19.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ARDAGH METAL PACDL 0001 vs. MCEWEN MINING INC
Performance |
| Timeline |
| ARDAGH METAL PACDL |
| MCEWEN MINING INC |
ARDAGH METAL and MCEWEN MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ARDAGH METAL and MCEWEN MINING
The main advantage of trading using opposite ARDAGH METAL and MCEWEN MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ARDAGH METAL 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.| ARDAGH METAL vs. KAUFMAN ET BROAD | ARDAGH METAL vs. GRIFFIN MINING LTD | ARDAGH METAL vs. Nishi Nippon Railroad Co | ARDAGH METAL vs. EVS Broadcast Equipment |
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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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