Correlation Between MCEWEN MINING and DEXUS

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

By analyzing existing cross correlation between MCEWEN MINING INC and DEXUS, you can compare the effects of market volatilities on MCEWEN MINING and DEXUS 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 DEXUS. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCEWEN MINING and DEXUS.

Diversification Opportunities for MCEWEN MINING and DEXUS

0.02

Correlation Coefficient

MCEWEN MINING  DEXUS

Significant diversification

The 3 months correlation between MCEWEN and DEXUS is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding MCEWEN MINING INC and DEXUS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DEXUS 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 INC are associated (or correlated) with DEXUS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DEXUS has no effect on the direction of MCEWEN MINING i.e., MCEWEN MINING and DEXUS go up and down completely randomly.

Pair Corralation between MCEWEN MINING and DEXUS

Assuming the 90 days horizon MCEWEN MINING INC is expected to under-perform the DEXUS. In addition to that, MCEWEN MINING is 2.71 times more volatile than DEXUS. It trades about -0.08 of its total potential returns per unit of risk. DEXUS is currently generating about 0.18 per unit of volatility. If you would invest  419.00  in DEXUS on September 5, 2024 and sell it today you would earn a total of  22.00  from holding DEXUS or generate 5.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

MCEWEN MINING INC  vs.  DEXUS

MCEWEN MINING INC

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in MCEWEN MINING INC are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, MCEWEN MINING may actually be approaching a critical reversion point that can send shares even higher in January 2025.

DEXUS

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in DEXUS are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, DEXUS is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with MCEWEN MINING and DEXUS

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

The idea behind MCEWEN MINING INC and DEXUS 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.