Correlation Between MCEWEN MINING and American Eagle
Can any of the company-specific risk be diversified away by investing in both MCEWEN MINING and American Eagle 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 American Eagle 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 American Eagle Outfitters, you can compare the effects of market volatilities on MCEWEN MINING and American Eagle 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 American Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCEWEN MINING and American Eagle.
Diversification Opportunities for MCEWEN MINING and American Eagle
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between MCEWEN and American is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding MCEWEN MINING INC and American Eagle Outfitters in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Eagle Outfitters 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 American Eagle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Eagle Outfitters has no effect on the direction of MCEWEN MINING i.e., MCEWEN MINING and American Eagle go up and down completely randomly.
Pair Corralation between MCEWEN MINING and American Eagle
Assuming the 90 days horizon MCEWEN MINING INC is expected to generate 1.12 times more return on investment than American Eagle. However, MCEWEN MINING is 1.12 times more volatile than American Eagle Outfitters. It trades about 0.17 of its potential returns per unit of risk. American Eagle Outfitters is currently generating about -0.08 per unit of risk. If you would invest 750.00 in MCEWEN MINING INC on October 20, 2024 and sell it today you would earn a total of 55.00 from holding MCEWEN MINING INC or generate 7.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MCEWEN MINING INC vs. American Eagle Outfitters
Performance |
| Timeline |
| MCEWEN MINING INC |
| American Eagle Outfitters |
MCEWEN MINING and American Eagle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MCEWEN MINING and American Eagle
The main advantage of trading using opposite MCEWEN MINING and American Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MCEWEN MINING position performs unexpectedly, American Eagle 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 American Eagle will offset losses from the drop in American Eagle's long position.| MCEWEN MINING vs. LOANDEPOT INC A | MCEWEN MINING vs. Canon Marketing Japan | MCEWEN MINING vs. H2O Retailing | MCEWEN MINING vs. Indutrade AB |
| American Eagle vs. Darden Restaurants | American Eagle vs. MCEWEN MINING INC | American Eagle vs. De Grey Mining | American Eagle vs. Lamar Advertising |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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