Correlation Between Agnico Eagle and CVW CleanTech
Can any of the company-specific risk be diversified away by investing in both Agnico Eagle and CVW CleanTech 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 CVW CleanTech 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 CVW CleanTech, you can compare the effects of market volatilities on Agnico Eagle and CVW CleanTech 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 CVW CleanTech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agnico Eagle and CVW CleanTech.
Diversification Opportunities for Agnico Eagle and CVW CleanTech
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Agnico and CVW is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Agnico Eagle Mines and CVW CleanTech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CVW CleanTech 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 CVW CleanTech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CVW CleanTech has no effect on the direction of Agnico Eagle i.e., Agnico Eagle and CVW CleanTech go up and down completely randomly.
Pair Corralation between Agnico Eagle and CVW CleanTech
Considering the 90-day investment horizon Agnico Eagle Mines is expected to generate 0.53 times more return on investment than CVW CleanTech. However, Agnico Eagle Mines is 1.9 times less risky than CVW CleanTech. It trades about 0.1 of its potential returns per unit of risk. CVW CleanTech is currently generating about -0.01 per unit of risk. If you would invest 6,460 in Agnico Eagle Mines on September 19, 2024 and sell it today you would earn a total of 1,588 from holding Agnico Eagle Mines or generate 24.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Agnico Eagle Mines vs. CVW CleanTech
Performance |
| Timeline |
| Agnico Eagle Mines |
| CVW CleanTech |
Agnico Eagle and CVW CleanTech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agnico Eagle and CVW CleanTech
The main advantage of trading using opposite Agnico Eagle and CVW CleanTech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agnico Eagle position performs unexpectedly, CVW CleanTech 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 CVW CleanTech will offset losses from the drop in CVW CleanTech's long position.| Agnico Eagle vs. Wheaton Precious Metals | Agnico Eagle vs. Newmont Goldcorp Corp | Agnico Eagle vs. Kinross Gold | Agnico Eagle vs. Gold Fields Ltd |
| CVW CleanTech vs. Legacy Education | CVW CleanTech vs. Apple Inc | CVW CleanTech vs. NVIDIA | CVW CleanTech vs. Microsoft |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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