Correlation Between McEwen Mining and INVEX Controladora
Can any of the company-specific risk be diversified away by investing in both McEwen Mining and INVEX Controladora 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 INVEX Controladora into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between McEwen Mining and INVEX Controladora SAB, you can compare the effects of market volatilities on McEwen Mining and INVEX Controladora 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 INVEX Controladora. Check out your portfolio center. Please also check ongoing floating volatility patterns of McEwen Mining and INVEX Controladora.
Diversification Opportunities for McEwen Mining and INVEX Controladora
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between McEwen and INVEX is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding McEwen Mining and INVEX Controladora SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INVEX Controladora SAB 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 INVEX Controladora. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INVEX Controladora SAB has no effect on the direction of McEwen Mining i.e., McEwen Mining and INVEX Controladora go up and down completely randomly.
Pair Corralation between McEwen Mining and INVEX Controladora
Assuming the 90 days trading horizon McEwen Mining is expected to generate 10.3 times more return on investment than INVEX Controladora. However, McEwen Mining is 10.3 times more volatile than INVEX Controladora SAB. It trades about 0.05 of its potential returns per unit of risk. INVEX Controladora SAB is currently generating about 0.06 per unit of risk. If you would invest 7,500 in McEwen Mining on September 3, 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 | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
McEwen Mining vs. INVEX Controladora SAB
Performance |
| Timeline |
| McEwen Mining |
| INVEX Controladora SAB |
McEwen Mining and INVEX Controladora Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with McEwen Mining and INVEX Controladora
The main advantage of trading using opposite McEwen Mining and INVEX Controladora positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if McEwen Mining position performs unexpectedly, INVEX Controladora 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 INVEX Controladora will offset losses from the drop in INVEX Controladora's long position.| McEwen Mining vs. Glencore plc | McEwen Mining vs. Minera Frisco SAB | McEwen Mining vs. The Select Sector | McEwen Mining vs. Promotora y Operadora |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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