Correlation Between Intact Financial and Avino Silver
Can any of the company-specific risk be diversified away by investing in both Intact Financial and Avino Silver 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 Intact Financial and Avino Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intact Financial Corp and Avino Silver Gold, you can compare the effects of market volatilities on Intact Financial and Avino Silver 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 Intact Financial with a short position of Avino Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intact Financial and Avino Silver.
Diversification Opportunities for Intact Financial and Avino Silver
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Intact and Avino is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Intact Financial Corp and Avino Silver Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avino Silver Gold and Intact Financial 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 Intact Financial Corp are associated (or correlated) with Avino Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avino Silver Gold has no effect on the direction of Intact Financial i.e., Intact Financial and Avino Silver go up and down completely randomly.
Pair Corralation between Intact Financial and Avino Silver
Assuming the 90 days trading horizon Intact Financial is expected to generate 4.3 times less return on investment than Avino Silver. But when comparing it to its historical volatility, Intact Financial Corp is 9.13 times less risky than Avino Silver. It trades about 0.19 of its potential returns per unit of risk. Avino Silver Gold is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 152.00 in Avino Silver Gold on September 14, 2024 and sell it today you would earn a total of 9.00 from holding Avino Silver Gold or generate 5.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intact Financial Corp vs. Avino Silver Gold
Performance |
| Timeline |
| Intact Financial Corp |
| Avino Silver Gold |
Intact Financial and Avino Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intact Financial and Avino Silver
The main advantage of trading using opposite Intact Financial and Avino Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intact Financial position performs unexpectedly, Avino Silver 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 Avino Silver will offset losses from the drop in Avino Silver's long position.| Intact Financial vs. Brookfield Infrastructure Partners | Intact Financial vs. Brookfield Infrastructure Partners | Intact Financial vs. iShares Canadian HYBrid | Intact Financial vs. Solar Alliance Energy |
| Avino Silver vs. Laurentian Bank | Avino Silver vs. Intact Financial Corp | Avino Silver vs. Definity Financial Corp | Avino Silver vs. Precision Drilling |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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