Correlation Between Evolution Mining and MCEWEN MINING
Can any of the company-specific risk be diversified away by investing in both Evolution Mining 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 Evolution Mining and MCEWEN MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evolution Mining Limited and MCEWEN MINING INC, you can compare the effects of market volatilities on Evolution Mining 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 Evolution Mining with a short position of MCEWEN MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evolution Mining and MCEWEN MINING.
Diversification Opportunities for Evolution Mining and MCEWEN MINING
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Evolution and MCEWEN is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Evolution Mining Limited and MCEWEN MINING INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MCEWEN MINING INC and Evolution 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 Evolution Mining Limited 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 INC has no effect on the direction of Evolution Mining i.e., Evolution Mining and MCEWEN MINING go up and down completely randomly.
Pair Corralation between Evolution Mining and MCEWEN MINING
Assuming the 90 days horizon Evolution Mining is expected to generate 1.01 times less return on investment than MCEWEN MINING. But when comparing it to its historical volatility, Evolution Mining Limited is 1.39 times less risky than MCEWEN MINING. It trades about 0.06 of its potential returns per unit of risk. MCEWEN MINING INC is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 530.00 in MCEWEN MINING INC on August 28, 2024 and sell it today you would earn a total of 290.00 from holding MCEWEN MINING INC or generate 54.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Evolution Mining Limited vs. MCEWEN MINING INC
Performance |
| Timeline |
| Evolution Mining |
| MCEWEN MINING INC |
Evolution Mining and MCEWEN MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evolution Mining and MCEWEN MINING
The main advantage of trading using opposite Evolution Mining and MCEWEN MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evolution Mining 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.| Evolution Mining vs. Sanyo Chemical Industries | Evolution Mining vs. MAGIC SOFTWARE ENTR | Evolution Mining vs. GLG LIFE TECH | Evolution Mining vs. Digilife Technologies Limited |
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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