Correlation Between MCEWEN MINING and Gamma Communications
Can any of the company-specific risk be diversified away by investing in both MCEWEN MINING and Gamma Communications 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 Gamma Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MCEWEN MINING INC and Gamma Communications plc, you can compare the effects of market volatilities on MCEWEN MINING and Gamma Communications 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 Gamma Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCEWEN MINING and Gamma Communications.
Diversification Opportunities for MCEWEN MINING and Gamma Communications
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between MCEWEN and Gamma is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding MCEWEN MINING INC and Gamma Communications plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gamma Communications plc 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 INC are associated (or correlated) with Gamma Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gamma Communications plc has no effect on the direction of MCEWEN MINING i.e., MCEWEN MINING and Gamma Communications go up and down completely randomly.
Pair Corralation between MCEWEN MINING and Gamma Communications
Assuming the 90 days horizon MCEWEN MINING is expected to generate 7.82 times less return on investment than Gamma Communications. In addition to that, MCEWEN MINING is 1.56 times more volatile than Gamma Communications plc. It trades about 0.01 of its total potential returns per unit of risk. Gamma Communications plc is currently generating about 0.07 per unit of volatility. If you would invest 1,794 in Gamma Communications plc on September 2, 2024 and sell it today you would earn a total of 156.00 from holding Gamma Communications plc or generate 8.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MCEWEN MINING INC vs. Gamma Communications plc
Performance |
| Timeline |
| MCEWEN MINING INC |
| Gamma Communications plc |
MCEWEN MINING and Gamma Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MCEWEN MINING and Gamma Communications
The main advantage of trading using opposite MCEWEN MINING and Gamma Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MCEWEN MINING position performs unexpectedly, Gamma Communications 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 Gamma Communications will offset losses from the drop in Gamma Communications' long position.| MCEWEN MINING vs. LG Electronics | MCEWEN MINING vs. LIFENET INSURANCE CO | MCEWEN MINING vs. STMicroelectronics NV | MCEWEN MINING vs. Electronic Arts |
| Gamma Communications vs. BJs Wholesale Club | Gamma Communications vs. ARDAGH METAL PACDL 0001 | Gamma Communications vs. Lendlease Group | Gamma Communications vs. PARKEN Sport Entertainment |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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