Correlation Between Xeros Technology and McEwen Mining
Can any of the company-specific risk be diversified away by investing in both Xeros Technology 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 Xeros Technology and McEwen Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xeros Technology Group and McEwen Mining, you can compare the effects of market volatilities on Xeros Technology 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 Xeros Technology with a short position of McEwen Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xeros Technology and McEwen Mining.
Diversification Opportunities for Xeros Technology and McEwen Mining
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xeros and McEwen is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Xeros Technology Group and McEwen Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on McEwen Mining and Xeros Technology 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 Xeros Technology Group 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 Xeros Technology i.e., Xeros Technology and McEwen Mining go up and down completely randomly.
Pair Corralation between Xeros Technology and McEwen Mining
Assuming the 90 days trading horizon Xeros Technology Group is expected to under-perform the McEwen Mining. In addition to that, Xeros Technology is 1.28 times more volatile than McEwen Mining. It trades about -0.21 of its total potential returns per unit of risk. McEwen Mining is currently generating about -0.02 per unit of volatility. If you would invest 917.00 in McEwen Mining on September 25, 2024 and sell it today you would lose (122.00) from holding McEwen Mining or give up 13.3% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 99.22% |
Values | Daily Returns |
Xeros Technology Group vs. McEwen Mining
Performance |
Timeline |
Xeros Technology |
McEwen Mining |
Xeros Technology and McEwen Mining Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Xeros Technology and McEwen Mining
The main advantage of trading using opposite Xeros Technology and McEwen Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xeros Technology 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.Xeros Technology vs. Samsung Electronics Co | Xeros Technology vs. Samsung Electronics Co | Xeros Technology vs. Hyundai Motor | Xeros Technology vs. Toyota Motor Corp |
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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 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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