Correlation Between MCEWEN MINING and Choice Hotels
Can any of the company-specific risk be diversified away by investing in both MCEWEN MINING and Choice Hotels 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 Choice Hotels 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 Choice Hotels International, you can compare the effects of market volatilities on MCEWEN MINING and Choice Hotels 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 Choice Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCEWEN MINING and Choice Hotels.
Diversification Opportunities for MCEWEN MINING and Choice Hotels
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MCEWEN and Choice is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding MCEWEN MINING INC and Choice Hotels International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Choice Hotels Intern 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 Choice Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Choice Hotels Intern has no effect on the direction of MCEWEN MINING i.e., MCEWEN MINING and Choice Hotels go up and down completely randomly.
Pair Corralation between MCEWEN MINING and Choice Hotels
Assuming the 90 days horizon MCEWEN MINING INC is expected to generate 2.23 times more return on investment than Choice Hotels. However, MCEWEN MINING is 2.23 times more volatile than Choice Hotels International. It trades about 0.04 of its potential returns per unit of risk. Choice Hotels International is currently generating about 0.04 per unit of risk. If you would invest 555.00 in MCEWEN MINING INC on September 13, 2024 and sell it today you would earn a total of 300.00 from holding MCEWEN MINING INC or generate 54.05% 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. Choice Hotels International
Performance |
| Timeline |
| MCEWEN MINING INC |
| Choice Hotels Intern |
MCEWEN MINING and Choice Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MCEWEN MINING and Choice Hotels
The main advantage of trading using opposite MCEWEN MINING and Choice Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MCEWEN MINING position performs unexpectedly, Choice Hotels 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 Choice Hotels will offset losses from the drop in Choice Hotels' long position.| MCEWEN MINING vs. NEW PACIFIC METALS | MCEWEN MINING vs. Superior Plus Corp | MCEWEN MINING vs. SIVERS SEMICONDUCTORS AB | MCEWEN MINING vs. Norsk Hydro ASA |
| Choice Hotels vs. Hyatt Hotels | Choice Hotels vs. InterContinental Hotels Group | Choice Hotels vs. INTERCONT HOTELS | Choice Hotels vs. Wyndham Hotels Resorts |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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