Correlation Between MCEWEN MINING and FARO Technologies
Can any of the company-specific risk be diversified away by investing in both MCEWEN MINING and FARO Technologies 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 FARO Technologies 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 FARO Technologies, you can compare the effects of market volatilities on MCEWEN MINING and FARO Technologies 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 FARO Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCEWEN MINING and FARO Technologies.
Diversification Opportunities for MCEWEN MINING and FARO Technologies
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between MCEWEN and FARO is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding MCEWEN MINING INC and FARO Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FARO Technologies 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 FARO Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FARO Technologies has no effect on the direction of MCEWEN MINING i.e., MCEWEN MINING and FARO Technologies go up and down completely randomly.
Pair Corralation between MCEWEN MINING and FARO Technologies
Assuming the 90 days horizon MCEWEN MINING INC is expected to generate 1.59 times more return on investment than FARO Technologies. However, MCEWEN MINING is 1.59 times more volatile than FARO Technologies. It trades about 0.05 of its potential returns per unit of risk. FARO Technologies is currently generating about -0.02 per unit of risk. If you would invest 795.00 in MCEWEN MINING INC on September 13, 2024 and sell it today you would earn a total of 20.00 from holding MCEWEN MINING INC or generate 2.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MCEWEN MINING INC vs. FARO Technologies
Performance |
| Timeline |
| MCEWEN MINING INC |
| FARO Technologies |
MCEWEN MINING and FARO Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MCEWEN MINING and FARO Technologies
The main advantage of trading using opposite MCEWEN MINING and FARO Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MCEWEN MINING position performs unexpectedly, FARO Technologies 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 FARO Technologies will offset losses from the drop in FARO Technologies' 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 |
| FARO Technologies vs. HEXAGON AB ADR1 | FARO Technologies vs. Superior Plus Corp | FARO Technologies vs. SIVERS SEMICONDUCTORS AB | FARO Technologies vs. NorAm Drilling AS |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |