Correlation Between McEwen Mining and Amgen
Can any of the company-specific risk be diversified away by investing in both McEwen Mining and Amgen 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 Amgen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between McEwen Mining and Amgen Inc, you can compare the effects of market volatilities on McEwen Mining and Amgen 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 Amgen. Check out your portfolio center. Please also check ongoing floating volatility patterns of McEwen Mining and Amgen.
Diversification Opportunities for McEwen Mining and Amgen
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between McEwen and Amgen is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding McEwen Mining and Amgen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amgen Inc 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 Amgen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amgen Inc has no effect on the direction of McEwen Mining i.e., McEwen Mining and Amgen go up and down completely randomly.
Pair Corralation between McEwen Mining and Amgen
Assuming the 90 days trading horizon McEwen Mining is expected to under-perform the Amgen. In addition to that, McEwen Mining is 1.62 times more volatile than Amgen Inc. It trades about -0.16 of its total potential returns per unit of risk. Amgen Inc is currently generating about 0.19 per unit of volatility. If you would invest 528,827 in Amgen Inc on December 29, 2024 and sell it today you would earn a total of 114,173 from holding Amgen Inc or generate 21.59% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
McEwen Mining vs. Amgen Inc
Performance |
Timeline |
McEwen Mining |
Amgen Inc |
McEwen Mining and Amgen Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with McEwen Mining and Amgen
The main advantage of trading using opposite McEwen Mining and Amgen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if McEwen Mining position performs unexpectedly, Amgen 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 Amgen will offset losses from the drop in Amgen's long position.McEwen Mining vs. Ameriprise Financial | McEwen Mining vs. Desarrolladora Homex SAB | McEwen Mining vs. Verizon Communications | McEwen Mining vs. Cognizant Technology Solutions |
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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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