Correlation Between MCEWEN MINING and Aluminum
Can any of the company-specific risk be diversified away by investing in both MCEWEN MINING and Aluminum 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 Aluminum 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 Aluminum of, you can compare the effects of market volatilities on MCEWEN MINING and Aluminum 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 Aluminum. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCEWEN MINING and Aluminum.
Diversification Opportunities for MCEWEN MINING and Aluminum
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between MCEWEN and Aluminum is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding MCEWEN MINING INC and Aluminum of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aluminum 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 Aluminum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aluminum has no effect on the direction of MCEWEN MINING i.e., MCEWEN MINING and Aluminum go up and down completely randomly.
Pair Corralation between MCEWEN MINING and Aluminum
Assuming the 90 days horizon MCEWEN MINING INC is expected to generate 1.36 times more return on investment than Aluminum. However, MCEWEN MINING is 1.36 times more volatile than Aluminum of. It trades about 0.15 of its potential returns per unit of risk. Aluminum of is currently generating about 0.2 per unit of risk. If you would invest 695.00 in MCEWEN MINING INC on April 20, 2025 and sell it today you would earn a total of 245.00 from holding MCEWEN MINING INC or generate 35.25% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
MCEWEN MINING INC vs. Aluminum of
Performance |
Timeline |
MCEWEN MINING INC |
Aluminum |
MCEWEN MINING and Aluminum Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with MCEWEN MINING and Aluminum
The main advantage of trading using opposite MCEWEN MINING and Aluminum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MCEWEN MINING position performs unexpectedly, Aluminum 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 Aluminum will offset losses from the drop in Aluminum's long position.MCEWEN MINING vs. Cleanaway Waste Management | MCEWEN MINING vs. Entravision Communications | MCEWEN MINING vs. Shunfeng International Clean | MCEWEN MINING vs. SmarTone Telecommunications Holdings |
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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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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