Correlation Between McEwen Mining and Hoteles City
Can any of the company-specific risk be diversified away by investing in both McEwen Mining and Hoteles City 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 McEwen Mining and Hoteles City into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between McEwen Mining and Hoteles City Express, you can compare the effects of market volatilities on McEwen Mining and Hoteles City 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 McEwen Mining with a short position of Hoteles City. Check out your portfolio center. Please also check ongoing floating volatility patterns of McEwen Mining and Hoteles City.
Diversification Opportunities for McEwen Mining and Hoteles City
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between McEwen and Hoteles is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding McEwen Mining and Hoteles City Express in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hoteles City Express and McEwen Mining 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 McEwen Mining are associated (or correlated) with Hoteles City. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hoteles City Express has no effect on the direction of McEwen Mining i.e., McEwen Mining and Hoteles City go up and down completely randomly.
Pair Corralation between McEwen Mining and Hoteles City
Assuming the 90 days trading horizon McEwen Mining is expected to generate 2.56 times more return on investment than Hoteles City. However, McEwen Mining is 2.56 times more volatile than Hoteles City Express. It trades about 0.05 of its potential returns per unit of risk. Hoteles City Express is currently generating about -0.04 per unit of risk. If you would invest 7,500 in McEwen Mining on November 1, 2024 and sell it today you would earn a total of 12,300 from holding McEwen Mining or generate 164.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
McEwen Mining vs. Hoteles City Express
Performance |
| Timeline |
| McEwen Mining |
| Hoteles City Express |
McEwen Mining and Hoteles City Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with McEwen Mining and Hoteles City
The main advantage of trading using opposite McEwen Mining and Hoteles City positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if McEwen Mining position performs unexpectedly, Hoteles City 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 Hoteles City will offset losses from the drop in Hoteles City's long position.| McEwen Mining vs. Grupo Carso SAB | McEwen Mining vs. Grupo Sports World | McEwen Mining vs. DXC Technology | McEwen Mining vs. Desarrolladora Homex SAB |
| Hoteles City vs. Controladora Vuela Compaa | Hoteles City vs. Alsea SAB de | Hoteles City vs. Nemak S A | Hoteles City vs. Grupo Comercial Chedraui |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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