Correlation Between AKITA Drilling and Agnico Eagle
Can any of the company-specific risk be diversified away by investing in both AKITA Drilling and Agnico Eagle 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 AKITA Drilling and Agnico Eagle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AKITA Drilling and Agnico Eagle Mines, you can compare the effects of market volatilities on AKITA Drilling and Agnico Eagle 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 AKITA Drilling with a short position of Agnico Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of AKITA Drilling and Agnico Eagle.
Diversification Opportunities for AKITA Drilling and Agnico Eagle
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between AKITA and Agnico is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding AKITA Drilling and Agnico Eagle Mines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agnico Eagle Mines and AKITA Drilling 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 AKITA Drilling are associated (or correlated) with Agnico Eagle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agnico Eagle Mines has no effect on the direction of AKITA Drilling i.e., AKITA Drilling and Agnico Eagle go up and down completely randomly.
Pair Corralation between AKITA Drilling and Agnico Eagle
Assuming the 90 days horizon AKITA Drilling is expected to generate 12.31 times less return on investment than Agnico Eagle. But when comparing it to its historical volatility, AKITA Drilling is 1.57 times less risky than Agnico Eagle. It trades about 0.04 of its potential returns per unit of risk. Agnico Eagle Mines is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 7,563 in Agnico Eagle Mines on September 14, 2024 and sell it today you would earn a total of 958.00 from holding Agnico Eagle Mines or generate 12.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
AKITA Drilling vs. Agnico Eagle Mines
Performance |
| Timeline |
| AKITA Drilling |
| Agnico Eagle Mines |
AKITA Drilling and Agnico Eagle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AKITA Drilling and Agnico Eagle
The main advantage of trading using opposite AKITA Drilling and Agnico Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AKITA Drilling position performs unexpectedly, Agnico Eagle 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 Agnico Eagle will offset losses from the drop in Agnico Eagle's long position.| AKITA Drilling vs. Cathedral Energy Services | AKITA Drilling vs. Vantage Drilling International | AKITA Drilling vs. Seadrill Limited | AKITA Drilling vs. Noble plc |
| Agnico Eagle vs. Fortitude Gold Corp | Agnico Eagle vs. New Gold | Agnico Eagle vs. Galiano Gold | Agnico Eagle vs. GoldMining |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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