Correlation Between McEwen Mining and Glanbia PLC
Can any of the company-specific risk be diversified away by investing in both McEwen Mining and Glanbia PLC 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 Glanbia PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between McEwen Mining and Glanbia PLC, you can compare the effects of market volatilities on McEwen Mining and Glanbia PLC 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 Glanbia PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of McEwen Mining and Glanbia PLC.
Diversification Opportunities for McEwen Mining and Glanbia PLC
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between McEwen and Glanbia is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding McEwen Mining and Glanbia PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glanbia PLC 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 are associated (or correlated) with Glanbia PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glanbia PLC has no effect on the direction of McEwen Mining i.e., McEwen Mining and Glanbia PLC go up and down completely randomly.
Pair Corralation between McEwen Mining and Glanbia PLC
Considering the 90-day investment horizon McEwen Mining is expected to generate 2.87 times more return on investment than Glanbia PLC. However, McEwen Mining is 2.87 times more volatile than Glanbia PLC. It trades about 0.34 of its potential returns per unit of risk. Glanbia PLC is currently generating about -0.07 per unit of risk. If you would invest 908.00 in McEwen Mining on January 25, 2024 and sell it today you would earn a total of 203.00 from holding McEwen Mining or generate 22.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 90.91% |
| Values | Daily Returns |
McEwen Mining vs. Glanbia PLC
Performance |
| Timeline |
| McEwen Mining |
| Glanbia PLC |
McEwen Mining and Glanbia PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with McEwen Mining and Glanbia PLC
The main advantage of trading using opposite McEwen Mining and Glanbia PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if McEwen Mining position performs unexpectedly, Glanbia PLC 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 Glanbia PLC will offset losses from the drop in Glanbia PLC's long position.| McEwen Mining vs. Summa Silver Corp | McEwen Mining vs. GoGold Resources | McEwen Mining vs. Scottie Resources Corp | McEwen Mining vs. Brixton Metals |
| Glanbia PLC vs. Kingspan Group plc | Glanbia PLC vs. Smurfit Kappa Group | Glanbia PLC vs. Bank of Ireland |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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