Correlation Between Lendinvest PLC and McEwen Mining
Can any of the company-specific risk be diversified away by investing in both Lendinvest 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 Lendinvest 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 Lendinvest PLC and McEwen Mining, you can compare the effects of market volatilities on Lendinvest 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 Lendinvest PLC with a short position of McEwen Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lendinvest PLC and McEwen Mining.
Diversification Opportunities for Lendinvest PLC and McEwen Mining
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lendinvest and McEwen is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Lendinvest PLC and McEwen Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on McEwen Mining and Lendinvest 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 Lendinvest 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 has no effect on the direction of Lendinvest PLC i.e., Lendinvest PLC and McEwen Mining go up and down completely randomly.
Pair Corralation between Lendinvest PLC and McEwen Mining
Assuming the 90 days trading horizon Lendinvest PLC is expected to generate 0.55 times more return on investment than McEwen Mining. However, Lendinvest PLC is 1.82 times less risky than McEwen Mining. It trades about 0.08 of its potential returns per unit of risk. McEwen Mining is currently generating about -0.28 per unit of risk. If you would invest 2,600 in Lendinvest PLC on September 1, 2024 and sell it today you would earn a total of 50.00 from holding Lendinvest PLC or generate 1.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lendinvest PLC vs. McEwen Mining
Performance |
| Timeline |
| Lendinvest PLC |
| McEwen Mining |
Lendinvest PLC and McEwen Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lendinvest PLC and McEwen Mining
The main advantage of trading using opposite Lendinvest PLC and McEwen Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lendinvest 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.| Lendinvest PLC vs. Samsung Electronics Co | Lendinvest PLC vs. Samsung Electronics Co | Lendinvest PLC vs. Toyota Motor Corp | Lendinvest PLC vs. Reliance Industries Ltd |
| McEwen Mining vs. Pfeiffer Vacuum Technology | McEwen Mining vs. Spotify Technology SA | McEwen Mining vs. Check Point Software | McEwen Mining vs. Albion Technology General |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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