Correlation Between PENN Entertainment and MCEWEN MINING

Can any of the company-specific risk be diversified away by investing in both PENN Entertainment 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 PENN Entertainment and MCEWEN MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PENN Entertainment and MCEWEN MINING INC, you can compare the effects of market volatilities on PENN Entertainment 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 PENN Entertainment with a short position of MCEWEN MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of PENN Entertainment and MCEWEN MINING.

Diversification Opportunities for PENN Entertainment and MCEWEN MINING

0.71

Correlation Coefficient

PENN Entertainment  MCEWEN MINING

Poor diversification

The 3 months correlation between PENN and MCEWEN is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding PENN Entertainment 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 PENN Entertainment 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 PENN Entertainment 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 PENN Entertainment i.e., PENN Entertainment and MCEWEN MINING go up and down completely randomly.

Pair Corralation between PENN Entertainment and MCEWEN MINING

Assuming the 90 days trading horizon PENN Entertainment is expected to generate 1.22 times less return on investment than MCEWEN MINING. But when comparing it to its historical volatility, PENN Entertainment is 1.1 times less risky than MCEWEN MINING. It trades about 0.14 of its potential returns per unit of risk. MCEWEN MINING INC is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  695.00  in MCEWEN MINING INC on April 22, 2025 and sell it today you would earn a total of  255.00  from holding MCEWEN MINING INC or generate 36.69% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

PENN Entertainment  vs.  MCEWEN MINING INC

PENN Entertainment

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in PENN Entertainment are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, PENN Entertainment unveiled solid returns over the last few months and may actually be approaching a breakup point.

MCEWEN MINING INC

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in MCEWEN MINING INC are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, MCEWEN MINING reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PENN Entertainment and MCEWEN MINING

The main advantage of trading using opposite PENN Entertainment and MCEWEN MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PENN Entertainment 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.

The idea behind PENN Entertainment and MCEWEN MINING INC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.