Correlation Between MCEWEN MINING and ETFS Coffee
Can any of the company-specific risk be diversified away by investing in both MCEWEN MINING and ETFS Coffee 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 ETFS Coffee 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 ETFS Coffee ETC, you can compare the effects of market volatilities on MCEWEN MINING and ETFS Coffee 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 ETFS Coffee. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCEWEN MINING and ETFS Coffee.
Diversification Opportunities for MCEWEN MINING and ETFS Coffee
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between MCEWEN and ETFS is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding MCEWEN MINING INC and ETFS Coffee ETC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ETFS Coffee ETC 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 ETFS Coffee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ETFS Coffee ETC has no effect on the direction of MCEWEN MINING i.e., MCEWEN MINING and ETFS Coffee go up and down completely randomly.
Pair Corralation between MCEWEN MINING and ETFS Coffee
Assuming the 90 days horizon MCEWEN MINING is expected to generate 22.88 times less return on investment than ETFS Coffee. In addition to that, MCEWEN MINING is 1.32 times more volatile than ETFS Coffee ETC. It trades about 0.01 of its total potential returns per unit of risk. ETFS Coffee ETC is currently generating about 0.22 per unit of volatility. If you would invest 3,600 in ETFS Coffee ETC on November 2, 2024 and sell it today you would earn a total of 2,383 from holding ETFS Coffee ETC or generate 66.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.09% |
| Values | Daily Returns |
MCEWEN MINING INC vs. ETFS Coffee ETC
Performance |
| Timeline |
| MCEWEN MINING INC |
| ETFS Coffee ETC |
MCEWEN MINING and ETFS Coffee Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MCEWEN MINING and ETFS Coffee
The main advantage of trading using opposite MCEWEN MINING and ETFS Coffee positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MCEWEN MINING position performs unexpectedly, ETFS Coffee 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 ETFS Coffee will offset losses from the drop in ETFS Coffee's long position.| MCEWEN MINING vs. Telecom Argentina SA | MCEWEN MINING vs. Cairo Communication SpA | MCEWEN MINING vs. Spirent Communications plc | MCEWEN MINING vs. MidCap Financial Investment |
| ETFS Coffee vs. QBE Insurance Group | ETFS Coffee vs. Molson Coors Beverage | ETFS Coffee vs. Urban Outfitters | ETFS Coffee vs. China Resources Beer |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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