Correlation Between McEwen Mining and Diamcor Mining
Can any of the company-specific risk be diversified away by investing in both McEwen Mining and Diamcor 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 McEwen Mining and Diamcor Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between McEwen Mining and Diamcor Mining, you can compare the effects of market volatilities on McEwen Mining and Diamcor 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 McEwen Mining with a short position of Diamcor Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of McEwen Mining and Diamcor Mining.
Diversification Opportunities for McEwen Mining and Diamcor Mining
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between McEwen and Diamcor is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding McEwen Mining and Diamcor Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Diamcor Mining 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 Diamcor Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Diamcor Mining has no effect on the direction of McEwen Mining i.e., McEwen Mining and Diamcor Mining go up and down completely randomly.
Pair Corralation between McEwen Mining and Diamcor Mining
Considering the 90-day investment horizon McEwen Mining is expected to under-perform the Diamcor Mining. But the stock apears to be less risky and, when comparing its historical volatility, McEwen Mining is 3.0 times less risky than Diamcor Mining. The stock trades about -0.08 of its potential returns per unit of risk. The Diamcor Mining is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 4.00 in Diamcor Mining on August 26, 2024 and sell it today you would lose (2.00) from holding Diamcor Mining or give up 50.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
McEwen Mining vs. Diamcor Mining
Performance |
| Timeline |
| McEwen Mining |
| Diamcor Mining |
McEwen Mining and Diamcor Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with McEwen Mining and Diamcor Mining
The main advantage of trading using opposite McEwen Mining and Diamcor Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if McEwen Mining position performs unexpectedly, Diamcor 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 Diamcor Mining will offset losses from the drop in Diamcor Mining's long position.| McEwen Mining vs. Endeavour Silver Corp | McEwen Mining vs. Fortuna Silver Mines | McEwen Mining vs. New Gold | McEwen Mining vs. Sandstorm Gold Ltd |
| Diamcor Mining vs. Ascendant Resources | Diamcor Mining vs. Cantex Mine Development | Diamcor Mining vs. Amarc Resources | Diamcor Mining vs. Sterling Metals Corp |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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