Correlation Between MCEWEN MINING and ZANAGA IRON
Can any of the company-specific risk be diversified away by investing in both MCEWEN MINING and ZANAGA IRON 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 ZANAGA IRON 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 ZANAGA IRON ORE, you can compare the effects of market volatilities on MCEWEN MINING and ZANAGA IRON 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 ZANAGA IRON. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCEWEN MINING and ZANAGA IRON.
Diversification Opportunities for MCEWEN MINING and ZANAGA IRON
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MCEWEN and ZANAGA is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding MCEWEN MINING INC and ZANAGA IRON ORE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZANAGA IRON ORE 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 ZANAGA IRON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZANAGA IRON ORE has no effect on the direction of MCEWEN MINING i.e., MCEWEN MINING and ZANAGA IRON go up and down completely randomly.
Pair Corralation between MCEWEN MINING and ZANAGA IRON
Assuming the 90 days horizon MCEWEN MINING is expected to generate 1.04 times less return on investment than ZANAGA IRON. But when comparing it to its historical volatility, MCEWEN MINING INC is 2.28 times less risky than ZANAGA IRON. It trades about 0.02 of its potential returns per unit of risk. ZANAGA IRON ORE is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 8.55 in ZANAGA IRON ORE on August 31, 2024 and sell it today you would lose (5.35) from holding ZANAGA IRON ORE or give up 62.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.74% |
| Values | Daily Returns |
MCEWEN MINING INC vs. ZANAGA IRON ORE
Performance |
| Timeline |
| MCEWEN MINING INC |
| ZANAGA IRON ORE |
MCEWEN MINING and ZANAGA IRON Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MCEWEN MINING and ZANAGA IRON
The main advantage of trading using opposite MCEWEN MINING and ZANAGA IRON positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MCEWEN MINING position performs unexpectedly, ZANAGA IRON 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 ZANAGA IRON will offset losses from the drop in ZANAGA IRON's long position.| MCEWEN MINING vs. BLUESCOPE STEEL | MCEWEN MINING vs. MEDICAL FACILITIES NEW | MCEWEN MINING vs. IMAGIN MEDICAL INC | MCEWEN MINING vs. Avanos Medical |
| ZANAGA IRON vs. HOCHSCHILD MINING | ZANAGA IRON vs. CSSC Offshore Marine | ZANAGA IRON vs. Carsales | ZANAGA IRON vs. TSOGO SUN GAMING |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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