Correlation Between Coca-Cola FEMSA and MCEWEN MINING
Can any of the company-specific risk be diversified away by investing in both Coca-Cola FEMSA 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 Coca-Cola FEMSA and MCEWEN MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coca Cola FEMSA SAB and MCEWEN MINING INC, you can compare the effects of market volatilities on Coca-Cola FEMSA 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 Coca-Cola FEMSA with a short position of MCEWEN MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca-Cola FEMSA and MCEWEN MINING.
Diversification Opportunities for Coca-Cola FEMSA and MCEWEN MINING
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Coca-Cola and MCEWEN is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Coca Cola FEMSA SAB 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 Coca-Cola FEMSA 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 Coca Cola FEMSA SAB 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 Coca-Cola FEMSA i.e., Coca-Cola FEMSA and MCEWEN MINING go up and down completely randomly.
Pair Corralation between Coca-Cola FEMSA and MCEWEN MINING
Assuming the 90 days trading horizon Coca Cola FEMSA SAB is expected to generate 4.3 times more return on investment than MCEWEN MINING. However, Coca-Cola FEMSA is 4.3 times more volatile than MCEWEN MINING INC. It trades about 0.04 of its potential returns per unit of risk. MCEWEN MINING INC is currently generating about 0.04 per unit of risk. If you would invest 770.00 in Coca Cola FEMSA SAB on September 14, 2024 and sell it today you would lose (15.00) from holding Coca Cola FEMSA SAB or give up 1.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Coca Cola FEMSA SAB vs. MCEWEN MINING INC
Performance |
| Timeline |
| Coca Cola FEMSA |
| MCEWEN MINING INC |
Coca-Cola FEMSA and MCEWEN MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coca-Cola FEMSA and MCEWEN MINING
The main advantage of trading using opposite Coca-Cola FEMSA and MCEWEN MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca-Cola FEMSA 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.| Coca-Cola FEMSA vs. MCEWEN MINING INC | Coca-Cola FEMSA vs. REGAL ASIAN INVESTMENTS | Coca-Cola FEMSA vs. SLR Investment Corp | Coca-Cola FEMSA vs. ADRIATIC METALS LS 013355 |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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