Correlation Between NovaGold Resources and Avino Silver
Can any of the company-specific risk be diversified away by investing in both NovaGold Resources 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 NovaGold Resources and Avino Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NovaGold Resources and Avino Silver Gold, you can compare the effects of market volatilities on NovaGold Resources 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 NovaGold Resources with a short position of Avino Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of NovaGold Resources and Avino Silver.
Diversification Opportunities for NovaGold Resources and Avino Silver
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NovaGold and Avino is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding NovaGold Resources 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 NovaGold Resources 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 NovaGold Resources 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 NovaGold Resources i.e., NovaGold Resources and Avino Silver go up and down completely randomly.
Pair Corralation between NovaGold Resources and Avino Silver
Allowing for the 90-day total investment horizon NovaGold Resources is expected to generate 0.59 times more return on investment than Avino Silver. However, NovaGold Resources is 1.7 times less risky than Avino Silver. It trades about 0.02 of its potential returns per unit of risk. Avino Silver Gold is currently generating about -0.21 per unit of risk. If you would invest 363.00 in NovaGold Resources on August 27, 2024 and sell it today you would earn a total of 2.00 from holding NovaGold Resources or generate 0.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NovaGold Resources vs. Avino Silver Gold
Performance |
| Timeline |
| NovaGold Resources |
| Avino Silver Gold |
NovaGold Resources and Avino Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NovaGold Resources and Avino Silver
The main advantage of trading using opposite NovaGold Resources and Avino Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NovaGold Resources 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.The idea behind NovaGold Resources and Avino Silver Gold pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Avino Silver vs. Hecla Mining | Avino Silver vs. McEwen Mining | Avino Silver vs. Endeavour Silver Corp | Avino Silver vs. New Pacific Metals |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |