Correlation Between Texas Roadhouse and Agnico Eagle
Can any of the company-specific risk be diversified away by investing in both Texas Roadhouse and Agnico Eagle 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 Texas Roadhouse and Agnico Eagle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Texas Roadhouse and Agnico Eagle Mines, you can compare the effects of market volatilities on Texas Roadhouse and Agnico Eagle 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 Texas Roadhouse with a short position of Agnico Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Texas Roadhouse and Agnico Eagle.
Diversification Opportunities for Texas Roadhouse and Agnico Eagle
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Texas and Agnico is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Texas Roadhouse and Agnico Eagle Mines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agnico Eagle Mines and Texas Roadhouse 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 Texas Roadhouse are associated (or correlated) with Agnico Eagle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agnico Eagle Mines has no effect on the direction of Texas Roadhouse i.e., Texas Roadhouse and Agnico Eagle go up and down completely randomly.
Pair Corralation between Texas Roadhouse and Agnico Eagle
Given the investment horizon of 90 days Texas Roadhouse is expected to generate 1.1 times less return on investment than Agnico Eagle. But when comparing it to its historical volatility, Texas Roadhouse is 1.17 times less risky than Agnico Eagle. It trades about 0.15 of its potential returns per unit of risk. Agnico Eagle Mines is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 4,823 in Agnico Eagle Mines on August 28, 2024 and sell it today you would earn a total of 3,349 from holding Agnico Eagle Mines or generate 69.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Texas Roadhouse vs. Agnico Eagle Mines
Performance |
| Timeline |
| Texas Roadhouse |
| Agnico Eagle Mines |
Texas Roadhouse and Agnico Eagle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Texas Roadhouse and Agnico Eagle
The main advantage of trading using opposite Texas Roadhouse and Agnico Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Texas Roadhouse position performs unexpectedly, Agnico Eagle 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 Agnico Eagle will offset losses from the drop in Agnico Eagle's long position.| Texas Roadhouse vs. Brinker International | Texas Roadhouse vs. BJs Restaurants | Texas Roadhouse vs. Papa Johns International | Texas Roadhouse vs. Bloomin Brands |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |