Correlation Between International Tower and Avino Silver
Can any of the company-specific risk be diversified away by investing in both International Tower 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 International Tower and Avino Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Tower Hill and Avino Silver Gold, you can compare the effects of market volatilities on International Tower 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 International Tower with a short position of Avino Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Tower and Avino Silver.
Diversification Opportunities for International Tower and Avino Silver
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between International and Avino is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding International Tower Hill 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 International Tower 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 International Tower Hill 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 International Tower i.e., International Tower and Avino Silver go up and down completely randomly.
Pair Corralation between International Tower and Avino Silver
Considering the 90-day investment horizon International Tower Hill is expected to generate 1.26 times more return on investment than Avino Silver. However, International Tower is 1.26 times more volatile than Avino Silver Gold. It trades about -0.16 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 59.00 in International Tower Hill on August 28, 2024 and sell it today you would lose (13.00) from holding International Tower Hill or give up 22.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
International Tower Hill vs. Avino Silver Gold
Performance |
| Timeline |
| International Tower Hill |
| Avino Silver Gold |
International Tower and Avino Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Tower and Avino Silver
The main advantage of trading using opposite International Tower and Avino Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Tower 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 International Tower Hill 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. SilverCrest Metals | Avino Silver vs. McEwen Mining | Avino Silver vs. Metalla Royalty Streaming |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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