Correlation Between Grupo Industrial and McEwen Mining

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

By analyzing existing cross correlation between Grupo Industrial Saltillo and McEwen Mining, you can compare the effects of market volatilities on Grupo Industrial 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 Grupo Industrial with a short position of McEwen Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Industrial and McEwen Mining.

Diversification Opportunities for Grupo Industrial and McEwen Mining

-0.81

Correlation Coefficient

Grupo Industrial  McEwen Mining

Pay attention - limited upside

The 3 months correlation between Grupo and McEwen is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Industrial Saltillo and McEwen Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on McEwen Mining and Grupo Industrial 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 Grupo Industrial Saltillo 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 Grupo Industrial i.e., Grupo Industrial and McEwen Mining go up and down completely randomly.

Pair Corralation between Grupo Industrial and McEwen Mining

Assuming the 90 days trading horizon Grupo Industrial Saltillo is expected to under-perform the McEwen Mining. But the stock apears to be less risky and, when comparing its historical volatility, Grupo Industrial Saltillo is 2.67 times less risky than McEwen Mining. The stock trades about -0.13 of its potential returns per unit of risk. The McEwen Mining is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  14,548  in McEwen Mining on May 7, 2025 and sell it today you would earn a total of  7,320  from holding McEwen Mining or generate 50.32% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	98.46%
Values	Daily Returns

Grupo Industrial Saltillo  vs.  McEwen Mining

Grupo Industrial Saltillo

Risk-Adjusted Performance

Weakest

Over the last 90 days Grupo Industrial Saltillo has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

McEwen Mining

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in McEwen Mining are ranked lower than 15 (%) 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.

Pair Trading with Grupo Industrial and McEwen Mining

The main advantage of trading using opposite Grupo Industrial and McEwen Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Industrial 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.

The idea behind Grupo Industrial Saltillo and McEwen Mining 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.