Correlation Between VITEC SOFTWARE and MCEWEN MINING
Can any of the company-specific risk be diversified away by investing in both VITEC SOFTWARE 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 VITEC SOFTWARE and MCEWEN MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VITEC SOFTWARE GROUP and MCEWEN MINING INC, you can compare the effects of market volatilities on VITEC SOFTWARE 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 VITEC SOFTWARE with a short position of MCEWEN MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of VITEC SOFTWARE and MCEWEN MINING.
Diversification Opportunities for VITEC SOFTWARE and MCEWEN MINING
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between VITEC and MCEWEN is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding VITEC SOFTWARE GROUP 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 VITEC SOFTWARE 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 VITEC SOFTWARE GROUP 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 VITEC SOFTWARE i.e., VITEC SOFTWARE and MCEWEN MINING go up and down completely randomly.
Pair Corralation between VITEC SOFTWARE and MCEWEN MINING
Assuming the 90 days horizon VITEC SOFTWARE GROUP is expected to generate 0.45 times more return on investment than MCEWEN MINING. However, VITEC SOFTWARE GROUP is 2.23 times less risky than MCEWEN MINING. It trades about 0.25 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 4,058 in VITEC SOFTWARE GROUP on September 17, 2024 and sell it today you would earn a total of 348.00 from holding VITEC SOFTWARE GROUP or generate 8.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
VITEC SOFTWARE GROUP vs. MCEWEN MINING INC
Performance |
| Timeline |
| VITEC SOFTWARE GROUP |
| MCEWEN MINING INC |
VITEC SOFTWARE and MCEWEN MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VITEC SOFTWARE and MCEWEN MINING
The main advantage of trading using opposite VITEC SOFTWARE and MCEWEN MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VITEC SOFTWARE 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.| VITEC SOFTWARE vs. Apple Inc | VITEC SOFTWARE vs. Apple Inc | VITEC SOFTWARE vs. Apple Inc | VITEC SOFTWARE vs. Apple Inc |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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