Correlation Between Various Eateries and McEwen Mining
Can any of the company-specific risk be diversified away by investing in both Various Eateries and McEwen Mining 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 Various Eateries and McEwen Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Various Eateries PLC and McEwen Mining, you can compare the effects of market volatilities on Various Eateries and McEwen Mining 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 Various Eateries with a short position of McEwen Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Various Eateries and McEwen Mining.
Diversification Opportunities for Various Eateries and McEwen Mining
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Various and McEwen is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Various Eateries PLC and McEwen Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on McEwen Mining and Various Eateries 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 Various Eateries PLC are associated (or correlated) with McEwen Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of McEwen Mining has no effect on the direction of Various Eateries i.e., Various Eateries and McEwen Mining go up and down completely randomly.
Pair Corralation between Various Eateries and McEwen Mining
Assuming the 90 days trading horizon Various Eateries PLC is expected to generate 0.12 times more return on investment than McEwen Mining. However, Various Eateries PLC is 8.16 times less risky than McEwen Mining. It trades about 0.21 of its potential returns per unit of risk. McEwen Mining is currently generating about -0.44 per unit of risk. If you would invest 1,775 in Various Eateries PLC on August 30, 2024 and sell it today you would earn a total of 25.00 from holding Various Eateries PLC or generate 1.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Various Eateries PLC vs. McEwen Mining
Performance |
| Timeline |
| Various Eateries PLC |
| McEwen Mining |
Various Eateries and McEwen Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Various Eateries and McEwen Mining
The main advantage of trading using opposite Various Eateries and McEwen Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Various Eateries position performs unexpectedly, McEwen Mining 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 McEwen Mining will offset losses from the drop in McEwen Mining's long position.| Various Eateries vs. CVR Energy | Various Eateries vs. Viridian Therapeutics | Various Eateries vs. Nationwide Building Society | Various Eateries vs. Dollar Tree |
| McEwen Mining vs. Tungsten West PLC | McEwen Mining vs. Argo Group Limited | McEwen Mining vs. Hardide PLC | McEwen Mining vs. Versarien PLC |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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