Correlation Between MCEWEN MINING and Addus HomeCare
Can any of the company-specific risk be diversified away by investing in both MCEWEN MINING and Addus HomeCare 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 Addus HomeCare 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 Addus HomeCare, you can compare the effects of market volatilities on MCEWEN MINING and Addus HomeCare 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 Addus HomeCare. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCEWEN MINING and Addus HomeCare.
Diversification Opportunities for MCEWEN MINING and Addus HomeCare
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between MCEWEN and Addus is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding MCEWEN MINING INC and Addus HomeCare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Addus HomeCare 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 Addus HomeCare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Addus HomeCare has no effect on the direction of MCEWEN MINING i.e., MCEWEN MINING and Addus HomeCare go up and down completely randomly.
Pair Corralation between MCEWEN MINING and Addus HomeCare
Assuming the 90 days horizon MCEWEN MINING INC is expected to generate 1.63 times more return on investment than Addus HomeCare. However, MCEWEN MINING is 1.63 times more volatile than Addus HomeCare. It trades about 0.04 of its potential returns per unit of risk. Addus HomeCare is currently generating about 0.02 per unit of risk. If you would invest 520.00 in MCEWEN MINING INC on September 4, 2024 and sell it today you would earn a total of 265.00 from holding MCEWEN MINING INC or generate 50.96% 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. Addus HomeCare
Performance |
| Timeline |
| MCEWEN MINING INC |
| Addus HomeCare |
MCEWEN MINING and Addus HomeCare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MCEWEN MINING and Addus HomeCare
The main advantage of trading using opposite MCEWEN MINING and Addus HomeCare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MCEWEN MINING position performs unexpectedly, Addus HomeCare 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 Addus HomeCare will offset losses from the drop in Addus HomeCare's long position.| MCEWEN MINING vs. Superior Plus Corp | MCEWEN MINING vs. NMI Holdings | MCEWEN MINING vs. Origin Agritech | MCEWEN MINING vs. SIVERS SEMICONDUCTORS AB |
| Addus HomeCare vs. Superior Plus Corp | Addus HomeCare vs. NMI Holdings | Addus HomeCare vs. Origin Agritech | Addus HomeCare vs. SIVERS SEMICONDUCTORS AB |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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