Correlation Between MCEWEN MINING and LG Electronics
Can any of the company-specific risk be diversified away by investing in both MCEWEN MINING and LG Electronics 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 LG Electronics 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 LG Electronics, you can compare the effects of market volatilities on MCEWEN MINING and LG Electronics 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 LG Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCEWEN MINING and LG Electronics.
Diversification Opportunities for MCEWEN MINING and LG Electronics
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between MCEWEN and LGLG is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding MCEWEN MINING INC and LG Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LG Electronics 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 LG Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LG Electronics has no effect on the direction of MCEWEN MINING i.e., MCEWEN MINING and LG Electronics go up and down completely randomly.
Pair Corralation between MCEWEN MINING and LG Electronics
Assuming the 90 days horizon MCEWEN MINING INC is expected to generate 1.76 times more return on investment than LG Electronics. However, MCEWEN MINING is 1.76 times more volatile than LG Electronics. It trades about 0.04 of its potential returns per unit of risk. LG Electronics is currently generating about 0.0 per unit of risk. If you would invest 630.00 in MCEWEN MINING INC on September 3, 2024 and sell it today you would earn a total of 155.00 from holding MCEWEN MINING INC or generate 24.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MCEWEN MINING INC vs. LG Electronics
Performance |
| Timeline |
| MCEWEN MINING INC |
| LG Electronics |
MCEWEN MINING and LG Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MCEWEN MINING and LG Electronics
The main advantage of trading using opposite MCEWEN MINING and LG Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MCEWEN MINING position performs unexpectedly, LG Electronics 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 LG Electronics will offset losses from the drop in LG Electronics' long position.| MCEWEN MINING vs. Superior Plus Corp | MCEWEN MINING vs. NMI Holdings | MCEWEN MINING vs. Origin Agritech | MCEWEN MINING vs. SIVERS SEMICONDUCTORS AB |
| LG Electronics vs. Summit Hotel Properties | LG Electronics vs. SENECA FOODS A | LG Electronics vs. Meli Hotels International | LG Electronics vs. MELIA HOTELS |
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 Stocks Directory module to find actively traded stocks across global markets.
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