Correlation Between ZURICH INSURANCE and Agnico Eagle
Can any of the company-specific risk be diversified away by investing in both ZURICH INSURANCE 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 ZURICH INSURANCE and Agnico Eagle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ZURICH INSURANCE GROUP and Agnico Eagle Mines, you can compare the effects of market volatilities on ZURICH INSURANCE 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 ZURICH INSURANCE with a short position of Agnico Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZURICH INSURANCE and Agnico Eagle.
Diversification Opportunities for ZURICH INSURANCE and Agnico Eagle
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ZURICH and Agnico is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding ZURICH INSURANCE GROUP 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 ZURICH INSURANCE 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 ZURICH INSURANCE GROUP 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 ZURICH INSURANCE i.e., ZURICH INSURANCE and Agnico Eagle go up and down completely randomly.
Pair Corralation between ZURICH INSURANCE and Agnico Eagle
Assuming the 90 days trading horizon ZURICH INSURANCE is expected to generate 1.52 times less return on investment than Agnico Eagle. But when comparing it to its historical volatility, ZURICH INSURANCE GROUP is 1.66 times less risky than Agnico Eagle. It trades about 0.07 of its potential returns per unit of risk. Agnico Eagle Mines is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 4,656 in Agnico Eagle Mines on September 13, 2024 and sell it today you would earn a total of 3,580 from holding Agnico Eagle Mines or generate 76.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
ZURICH INSURANCE GROUP vs. Agnico Eagle Mines
Performance |
| Timeline |
| ZURICH INSURANCE |
| Agnico Eagle Mines |
ZURICH INSURANCE and Agnico Eagle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZURICH INSURANCE and Agnico Eagle
The main advantage of trading using opposite ZURICH INSURANCE and Agnico Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZURICH INSURANCE 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.| ZURICH INSURANCE vs. Apple Inc | ZURICH INSURANCE vs. Apple Inc | ZURICH INSURANCE vs. Apple Inc | ZURICH INSURANCE vs. Apple Inc |
| Agnico Eagle vs. FEMALE HEALTH | Agnico Eagle vs. ZURICH INSURANCE GROUP | Agnico Eagle vs. Bausch Health Companies | Agnico Eagle vs. Zurich Insurance Group |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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