Correlation Between Agnico Eagle and TVA
Can any of the company-specific risk be diversified away by investing in both Agnico Eagle and TVA 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 TVA 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 TVA Group, you can compare the effects of market volatilities on Agnico Eagle and TVA 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 TVA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agnico Eagle and TVA.
Diversification Opportunities for Agnico Eagle and TVA
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Agnico and TVA is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Agnico Eagle Mines and TVA Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TVA 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 TVA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TVA Group has no effect on the direction of Agnico Eagle i.e., Agnico Eagle and TVA go up and down completely randomly.
Pair Corralation between Agnico Eagle and TVA
Assuming the 90 days trading horizon Agnico Eagle Mines is expected to generate 0.3 times more return on investment than TVA. However, Agnico Eagle Mines is 3.3 times less risky than TVA. It trades about 0.15 of its potential returns per unit of risk. TVA Group is currently generating about -0.01 per unit of risk. If you would invest 11,636 in Agnico Eagle Mines on November 21, 2024 and sell it today you would earn a total of 2,158 from holding Agnico Eagle Mines or generate 18.55% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Agnico Eagle Mines vs. TVA Group
Performance |
Timeline |
Agnico Eagle Mines |
TVA Group |
Agnico Eagle and TVA Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Agnico Eagle and TVA
The main advantage of trading using opposite Agnico Eagle and TVA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agnico Eagle position performs unexpectedly, TVA 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 TVA will offset losses from the drop in TVA's long position.Agnico Eagle vs. Franco Nevada | ||
Agnico Eagle vs. Kinross Gold Corp | ||
Agnico Eagle vs. Barrick Gold Corp | ||
Agnico Eagle vs. Wheaton Precious Metals |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
CEOs Directory Screen CEOs from public companies around the world |