Correlation Between MCEWEN MINING and IMPERIAL TOBACCO
Can any of the company-specific risk be diversified away by investing in both MCEWEN MINING and IMPERIAL TOBACCO 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 IMPERIAL TOBACCO 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 IMPERIAL TOBACCO , you can compare the effects of market volatilities on MCEWEN MINING and IMPERIAL TOBACCO 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 IMPERIAL TOBACCO. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCEWEN MINING and IMPERIAL TOBACCO.
Diversification Opportunities for MCEWEN MINING and IMPERIAL TOBACCO
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MCEWEN and IMPERIAL is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding MCEWEN MINING INC and IMPERIAL TOBACCO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IMPERIAL TOBACCO 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 IMPERIAL TOBACCO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IMPERIAL TOBACCO has no effect on the direction of MCEWEN MINING i.e., MCEWEN MINING and IMPERIAL TOBACCO go up and down completely randomly.
Pair Corralation between MCEWEN MINING and IMPERIAL TOBACCO
Assuming the 90 days horizon MCEWEN MINING is expected to generate 1.33 times less return on investment than IMPERIAL TOBACCO. In addition to that, MCEWEN MINING is 3.24 times more volatile than IMPERIAL TOBACCO . It trades about 0.12 of its total potential returns per unit of risk. IMPERIAL TOBACCO is currently generating about 0.5 per unit of volatility. If you would invest 2,790 in IMPERIAL TOBACCO on September 12, 2024 and sell it today you would earn a total of 363.00 from holding IMPERIAL TOBACCO or generate 13.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
MCEWEN MINING INC vs. IMPERIAL TOBACCO
Performance |
| Timeline |
| MCEWEN MINING INC |
| IMPERIAL TOBACCO |
MCEWEN MINING and IMPERIAL TOBACCO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MCEWEN MINING and IMPERIAL TOBACCO
The main advantage of trading using opposite MCEWEN MINING and IMPERIAL TOBACCO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MCEWEN MINING position performs unexpectedly, IMPERIAL TOBACCO 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 IMPERIAL TOBACCO will offset losses from the drop in IMPERIAL TOBACCO's 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 |
| IMPERIAL TOBACCO vs. Apple Inc | IMPERIAL TOBACCO vs. Apple Inc | IMPERIAL TOBACCO vs. Apple Inc | IMPERIAL TOBACCO vs. Apple Inc |
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.
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