Correlation Between Fresnillo Plc and MCEWEN MINING
Can any of the company-specific risk be diversified away by investing in both Fresnillo Plc 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 Fresnillo Plc and MCEWEN MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fresnillo plc and MCEWEN MINING INC, you can compare the effects of market volatilities on Fresnillo Plc 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 Fresnillo Plc with a short position of MCEWEN MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fresnillo Plc and MCEWEN MINING.
Diversification Opportunities for Fresnillo Plc and MCEWEN MINING
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fresnillo and MCEWEN is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Fresnillo plc 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 Fresnillo Plc 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 Fresnillo plc 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 Fresnillo Plc i.e., Fresnillo Plc and MCEWEN MINING go up and down completely randomly.
Pair Corralation between Fresnillo Plc and MCEWEN MINING
Assuming the 90 days horizon Fresnillo plc is expected to under-perform the MCEWEN MINING. But the stock apears to be less risky and, when comparing its historical volatility, Fresnillo plc is 1.45 times less risky than MCEWEN MINING. The stock trades about -0.3 of its potential returns per unit of risk. The MCEWEN MINING INC is currently generating about -0.11 of returns per unit of risk over similar time horizon. If you would invest 855.00 in MCEWEN MINING INC on October 12, 2024 and sell it today you would lose (50.00) from holding MCEWEN MINING INC or give up 5.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 94.44% |
| Values | Daily Returns |
Fresnillo plc vs. MCEWEN MINING INC
Performance |
| Timeline |
| Fresnillo plc |
| MCEWEN MINING INC |
Fresnillo Plc and MCEWEN MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fresnillo Plc and MCEWEN MINING
The main advantage of trading using opposite Fresnillo Plc and MCEWEN MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fresnillo Plc 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.| Fresnillo Plc vs. Hua Hong Semiconductor | Fresnillo Plc vs. Nordic Semiconductor ASA | Fresnillo Plc vs. United Natural Foods | Fresnillo Plc vs. Austevoll Seafood ASA |
| MCEWEN MINING vs. Pentair plc | MCEWEN MINING vs. MOBILE FACTORY INC | MCEWEN MINING vs. SOGECLAIR SA INH | MCEWEN MINING vs. Charter Communications |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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