Correlation Between Agnico Eagle and Western Digital
Can any of the company-specific risk be diversified away by investing in both Agnico Eagle and Western Digital 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 Western Digital 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 Western Digital, you can compare the effects of market volatilities on Agnico Eagle and Western Digital 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 Western Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agnico Eagle and Western Digital.
Diversification Opportunities for Agnico Eagle and Western Digital
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Agnico and Western is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Agnico Eagle Mines and Western Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Digital 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 Western Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Digital has no effect on the direction of Agnico Eagle i.e., Agnico Eagle and Western Digital go up and down completely randomly.
Pair Corralation between Agnico Eagle and Western Digital
Considering the 90-day investment horizon Agnico Eagle Mines is expected to generate 0.74 times more return on investment than Western Digital. However, Agnico Eagle Mines is 1.35 times less risky than Western Digital. It trades about 0.11 of its potential returns per unit of risk. Western Digital is currently generating about 0.0 per unit of risk. If you would invest 6,546 in Agnico Eagle Mines on September 3, 2024 and sell it today you would earn a total of 1,896 from holding Agnico Eagle Mines or generate 28.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agnico Eagle Mines vs. Western Digital
Performance |
| Timeline |
| Agnico Eagle Mines |
| Western Digital |
Agnico Eagle and Western Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agnico Eagle and Western Digital
The main advantage of trading using opposite Agnico Eagle and Western Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agnico Eagle position performs unexpectedly, Western Digital 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 Western Digital will offset losses from the drop in Western Digital'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 |
| Western Digital vs. NetApp Inc | Western Digital vs. Logitech International SA | Western Digital vs. HP Inc | Western Digital vs. Dell Technologies |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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