Correlation Between Agnico Eagle and Trisura
Can any of the company-specific risk be diversified away by investing in both Agnico Eagle and Trisura 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 Agnico Eagle and Trisura into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agnico Eagle Mines and Trisura Group, you can compare the effects of market volatilities on Agnico Eagle and Trisura 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 Agnico Eagle with a short position of Trisura. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agnico Eagle and Trisura.
Diversification Opportunities for Agnico Eagle and Trisura
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Agnico and Trisura is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Agnico Eagle Mines and Trisura Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trisura Group and Agnico Eagle 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 Agnico Eagle Mines are associated (or correlated) with Trisura. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trisura Group has no effect on the direction of Agnico Eagle i.e., Agnico Eagle and Trisura go up and down completely randomly.
Pair Corralation between Agnico Eagle and Trisura
Assuming the 90 days trading horizon Agnico Eagle Mines is expected to generate 0.98 times more return on investment than Trisura. However, Agnico Eagle Mines is 1.02 times less risky than Trisura. It trades about 0.1 of its potential returns per unit of risk. Trisura Group is currently generating about 0.01 per unit of risk. If you would invest 6,183 in Agnico Eagle Mines on November 21, 2024 and sell it today you would earn a total of 7,611 from holding Agnico Eagle Mines or generate 123.1% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Agnico Eagle Mines vs. Trisura Group
Performance |
Timeline |
Agnico Eagle Mines |
Trisura Group |
Agnico Eagle and Trisura Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Agnico Eagle and Trisura
The main advantage of trading using opposite Agnico Eagle and Trisura positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agnico Eagle position performs unexpectedly, Trisura 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 Trisura will offset losses from the drop in Trisura's long position.Agnico Eagle vs. Franco Nevada | ||
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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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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