Correlation Between Noranda Aluminum and Avino Silver
Can any of the company-specific risk be diversified away by investing in both Noranda Aluminum 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 Noranda Aluminum and Avino Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Noranda Aluminum Holding and Avino Silver Gold, you can compare the effects of market volatilities on Noranda Aluminum 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 Noranda Aluminum with a short position of Avino Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Noranda Aluminum and Avino Silver.
Diversification Opportunities for Noranda Aluminum and Avino Silver
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Noranda and Avino is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Noranda Aluminum Holding 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 Noranda Aluminum 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 Noranda Aluminum Holding 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 Noranda Aluminum i.e., Noranda Aluminum and Avino Silver go up and down completely randomly.
Pair Corralation between Noranda Aluminum and Avino Silver
If you would invest (100.00) in Noranda Aluminum Holding on August 27, 2024 and sell it today you would earn a total of 100.00 from holding Noranda Aluminum Holding or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 0.0% |
| Values | Daily Returns |
Noranda Aluminum Holding vs. Avino Silver Gold
Performance |
| Timeline |
| Noranda Aluminum Holding |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Avino Silver Gold |
Noranda Aluminum and Avino Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Noranda Aluminum and Avino Silver
The main advantage of trading using opposite Noranda Aluminum and Avino Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Noranda Aluminum 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.| Noranda Aluminum vs. BCE Inc | Noranda Aluminum vs. Space Communication | Noranda Aluminum vs. Pinterest | Noranda Aluminum vs. Fevertree Drinks Plc |
| 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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