Correlation Between MCEWEN MINING and Chunghwa Telecom
Can any of the company-specific risk be diversified away by investing in both MCEWEN MINING and Chunghwa Telecom 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 Chunghwa Telecom 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 Chunghwa Telecom Co, you can compare the effects of market volatilities on MCEWEN MINING and Chunghwa Telecom 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 Chunghwa Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCEWEN MINING and Chunghwa Telecom.
Diversification Opportunities for MCEWEN MINING and Chunghwa Telecom
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MCEWEN and Chunghwa is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding MCEWEN MINING INC and Chunghwa Telecom Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chunghwa Telecom 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 Chunghwa Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chunghwa Telecom has no effect on the direction of MCEWEN MINING i.e., MCEWEN MINING and Chunghwa Telecom go up and down completely randomly.
Pair Corralation between MCEWEN MINING and Chunghwa Telecom
Assuming the 90 days horizon MCEWEN MINING INC is expected to under-perform the Chunghwa Telecom. In addition to that, MCEWEN MINING is 2.6 times more volatile than Chunghwa Telecom Co. It trades about -0.2 of its total potential returns per unit of risk. Chunghwa Telecom Co is currently generating about 0.15 per unit of volatility. If you would invest 3,440 in Chunghwa Telecom Co on September 1, 2024 and sell it today you would earn a total of 160.00 from holding Chunghwa Telecom Co or generate 4.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MCEWEN MINING INC vs. Chunghwa Telecom Co
Performance |
| Timeline |
| MCEWEN MINING INC |
| Chunghwa Telecom |
MCEWEN MINING and Chunghwa Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MCEWEN MINING and Chunghwa Telecom
The main advantage of trading using opposite MCEWEN MINING and Chunghwa Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MCEWEN MINING position performs unexpectedly, Chunghwa Telecom 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 Chunghwa Telecom will offset losses from the drop in Chunghwa Telecom's long position.| MCEWEN MINING vs. COMMERCIAL VEHICLE | MCEWEN MINING vs. Pick n Pay | MCEWEN MINING vs. PICKN PAY STORES | MCEWEN MINING vs. Commercial Vehicle Group |
| Chunghwa Telecom vs. ATT Inc | Chunghwa Telecom vs. Deutsche Telekom AG | Chunghwa Telecom vs. Superior Plus Corp | Chunghwa Telecom vs. NMI Holdings |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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