Correlation Between Algonquin Power and Osisko Metals
Can any of the company-specific risk be diversified away by investing in both Algonquin Power and Osisko Metals 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 Algonquin Power and Osisko Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Algonquin Power Utilities and Osisko Metals, you can compare the effects of market volatilities on Algonquin Power and Osisko Metals 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 Algonquin Power with a short position of Osisko Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Algonquin Power and Osisko Metals.
Diversification Opportunities for Algonquin Power and Osisko Metals
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Algonquin and Osisko is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Algonquin Power Utilities and Osisko Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Osisko Metals and Algonquin Power 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 Algonquin Power Utilities are associated (or correlated) with Osisko Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Osisko Metals has no effect on the direction of Algonquin Power i.e., Algonquin Power and Osisko Metals go up and down completely randomly.
Pair Corralation between Algonquin Power and Osisko Metals
Assuming the 90 days trading horizon Algonquin Power Utilities is expected to under-perform the Osisko Metals. But the preferred stock apears to be less risky and, when comparing its historical volatility, Algonquin Power Utilities is 8.87 times less risky than Osisko Metals. The preferred stock trades about -0.04 of its potential returns per unit of risk. The Osisko Metals is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 22.00 in Osisko Metals on August 29, 2024 and sell it today you would earn a total of 4.00 from holding Osisko Metals or generate 18.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Algonquin Power Utilities vs. Osisko Metals
Performance |
| Timeline |
| Algonquin Power Utilities |
| Osisko Metals |
Algonquin Power and Osisko Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Algonquin Power and Osisko Metals
The main advantage of trading using opposite Algonquin Power and Osisko Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Algonquin Power position performs unexpectedly, Osisko Metals 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 Osisko Metals will offset losses from the drop in Osisko Metals' long position.| Algonquin Power vs. Forstrong Global Income | Algonquin Power vs. Terreno Resources Corp | Algonquin Power vs. iShares Canadian HYBrid | Algonquin Power vs. Brompton European Dividend |
| Osisko Metals vs. Volcanic Gold Mines | Osisko Metals vs. Wolfden Resources | Osisko Metals vs. Tarku Resources | Osisko Metals vs. Blue Star Gold |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |