Correlation Between Osisko Metals and Algonquin Power
Can any of the company-specific risk be diversified away by investing in both Osisko Metals and Algonquin Power 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 Osisko Metals and Algonquin Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Osisko Metals and Algonquin Power Utilities, you can compare the effects of market volatilities on Osisko Metals and Algonquin Power 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 Osisko Metals with a short position of Algonquin Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Osisko Metals and Algonquin Power.
Diversification Opportunities for Osisko Metals and Algonquin Power
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Osisko and Algonquin is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Osisko Metals and Algonquin Power Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Algonquin Power Utilities and Osisko Metals 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 Osisko Metals are associated (or correlated) with Algonquin Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Algonquin Power Utilities has no effect on the direction of Osisko Metals i.e., Osisko Metals and Algonquin Power go up and down completely randomly.
Pair Corralation between Osisko Metals and Algonquin Power
Given the investment horizon of 90 days Osisko Metals is expected to generate 8.87 times more return on investment than Algonquin Power. However, Osisko Metals is 8.87 times more volatile than Algonquin Power Utilities. It trades about 0.15 of its potential returns per unit of risk. Algonquin Power Utilities is currently generating about -0.04 per unit of risk. 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 |
Osisko Metals vs. Algonquin Power Utilities
Performance |
| Timeline |
| Osisko Metals |
| Algonquin Power Utilities |
Osisko Metals and Algonquin Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Osisko Metals and Algonquin Power
The main advantage of trading using opposite Osisko Metals and Algonquin Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Osisko Metals position performs unexpectedly, Algonquin Power 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 Algonquin Power will offset losses from the drop in Algonquin Power's long position.| Osisko Metals vs. Volcanic Gold Mines | Osisko Metals vs. Wolfden Resources | Osisko Metals vs. Tarku Resources | Osisko Metals vs. Blue Star Gold |
| Algonquin Power vs. Forstrong Global Income | Algonquin Power vs. Terreno Resources Corp | Algonquin Power vs. iShares Canadian HYBrid | Algonquin Power vs. Brompton European Dividend |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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