Correlation Between Almaden Minerals and McEwen Mining
Can any of the company-specific risk be diversified away by investing in both Almaden Minerals 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 Almaden Minerals and McEwen Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Almaden Minerals and McEwen Mining, you can compare the effects of market volatilities on Almaden Minerals 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 Almaden Minerals with a short position of McEwen Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Almaden Minerals and McEwen Mining.
Diversification Opportunities for Almaden Minerals and McEwen Mining
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Almaden and McEwen is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Almaden Minerals and McEwen Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on McEwen Mining and Almaden Minerals 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 Almaden Minerals 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 Almaden Minerals i.e., Almaden Minerals and McEwen Mining go up and down completely randomly.
Pair Corralation between Almaden Minerals and McEwen Mining
Considering the 90-day investment horizon Almaden Minerals is expected to generate 15.64 times less return on investment than McEwen Mining. But when comparing it to its historical volatility, Almaden Minerals is 1.62 times less risky than McEwen Mining. It trades about 0.01 of its potential returns per unit of risk. McEwen Mining is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 611.00 in McEwen Mining on December 29, 2023 and sell it today you would earn a total of 352.00 from holding McEwen Mining or generate 57.61% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Almaden Minerals vs. McEwen Mining
Performance |
Timeline |
Almaden Minerals |
McEwen Mining |
Almaden Minerals and McEwen Mining Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Almaden Minerals and McEwen Mining
The main advantage of trading using opposite Almaden Minerals and McEwen Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Almaden Minerals 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.Almaden Minerals vs. United States Steel | Almaden Minerals vs. Alcoa Corp | Almaden Minerals vs. First Majestic Silver | Almaden Minerals vs. AngloGold Ashanti Plc |
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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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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