Correlation Between McEwen Mining and RLH Properties
Can any of the company-specific risk be diversified away by investing in both McEwen Mining and RLH Properties 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 RLH Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between McEwen Mining and RLH Properties SAB, you can compare the effects of market volatilities on McEwen Mining and RLH Properties 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 RLH Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of McEwen Mining and RLH Properties.
Diversification Opportunities for McEwen Mining and RLH Properties
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between McEwen and RLH is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding McEwen Mining and RLH Properties SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RLH Properties 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 RLH Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RLH Properties SAB has no effect on the direction of McEwen Mining i.e., McEwen Mining and RLH Properties go up and down completely randomly.
Pair Corralation between McEwen Mining and RLH Properties
Assuming the 90 days trading horizon McEwen Mining is expected to generate 5.55 times more return on investment than RLH Properties. However, McEwen Mining is 5.55 times more volatile than RLH Properties SAB. It trades about 0.05 of its potential returns per unit of risk. RLH Properties SAB is currently generating about 0.02 per unit of risk. If you would invest 7,500 in McEwen Mining on September 12, 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. RLH Properties SAB
Performance |
| Timeline |
| McEwen Mining |
| RLH Properties SAB |
McEwen Mining and RLH Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with McEwen Mining and RLH Properties
The main advantage of trading using opposite McEwen Mining and RLH Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if McEwen Mining position performs unexpectedly, RLH Properties 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 RLH Properties will offset losses from the drop in RLH Properties' long position.| McEwen Mining vs. Compaa Minera Autln | McEwen Mining vs. The Select Sector | McEwen Mining vs. Promotora y Operadora | McEwen Mining vs. iShares Global Timber |
| RLH Properties vs. Ameriprise Financial | RLH Properties vs. Prudential Financial | RLH Properties vs. McEwen Mining | RLH Properties vs. CVS Health |
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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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