Correlation Between McEwen Mining and Deutsche Bank

Can any of the company-specific risk be diversified away by investing in both McEwen Mining and Deutsche Bank 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 Deutsche Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between McEwen Mining and Deutsche Bank Aktiengesellschaft, you can compare the effects of market volatilities on McEwen Mining and Deutsche Bank 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 Deutsche Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of McEwen Mining and Deutsche Bank.

Diversification Opportunities for McEwen Mining and Deutsche Bank

0.82

Correlation Coefficient

McEwen Mining  Deutsche Bank

Very poor diversification

The 3 months correlation between McEwen and Deutsche is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding McEwen Mining and Deutsche Bank Aktiengesellscha in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Bank Aktien 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 Deutsche Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Bank Aktien has no effect on the direction of McEwen Mining i.e., McEwen Mining and Deutsche Bank go up and down completely randomly.

Pair Corralation between McEwen Mining and Deutsche Bank

If you would invest  34,000  in Deutsche Bank Aktiengesellschaft on September 4, 2024 and sell it today you would earn a total of  204.00  from holding Deutsche Bank Aktiengesellschaft or generate 0.6% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	85.0%
Values	Daily Returns

McEwen Mining  vs.  Deutsche Bank Aktiengesellscha

McEwen Mining

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in McEwen Mining are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, McEwen Mining showed solid returns over the last few months and may actually be approaching a breakup point.

Deutsche Bank Aktien

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Deutsche Bank Aktiengesellschaft are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Deutsche Bank may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with McEwen Mining and Deutsche Bank

The main advantage of trading using opposite McEwen Mining and Deutsche Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if McEwen Mining position performs unexpectedly, Deutsche Bank 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 Deutsche Bank will offset losses from the drop in Deutsche Bank's long position.

The idea behind McEwen Mining and Deutsche Bank Aktiengesellschaft 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.

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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.