Two Equities Correlation Analysis
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AEM
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This model provides you with a quick lookup of cross correlation between two equities. Please specify two instruments to run the correlation.
Diversification Opportunities for Agnico Eagle and NYSE Composite
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Agnico and NYSE is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Agnico Eagle Mines and NYSE Composite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NYSE Composite and Agnico Eagle 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 Agnico Eagle Mines are associated (or correlated) with NYSE Composite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NYSE Composite has no effect on the direction of Agnico Eagle i.e., Agnico Eagle and NYSE Composite go up and down completely randomly.
Pair Corralation between Agnico Eagle and NYSE Composite
Considering the 90-day investment horizon Agnico Eagle Mines is expected to generate 2.71 times more return on investment than NYSE Composite. However, Agnico Eagle is 2.71 times more volatile than NYSE Composite. It trades about 0.08 of its potential returns per unit of risk. NYSE Composite is currently generating about 0.07 per unit of risk. If you would invest 4,939 in Agnico Eagle Mines on January 23, 2024 and sell it today you would earn a total of 1,287 from holding Agnico Eagle Mines or generate 26.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agnico Eagle Mines vs. NYSE Composite
Performance |
| Timeline |
Agnico Eagle and NYSE Composite Volatility Contrast
Predicted Return Density |
| Returns |
Agnico Eagle Mines
Pair trading matchups for Agnico Eagle
NYSE Composite
Pair trading matchups for NYSE Composite
Pair Trading with Agnico Eagle and NYSE Composite
The main advantage of trading using opposite Agnico Eagle and NYSE Composite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agnico Eagle position performs unexpectedly, NYSE Composite 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 NYSE Composite will offset losses from the drop in NYSE Composite's long position.The idea behind Agnico Eagle Mines and NYSE Composite 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.| NYSE Composite vs. Reservoir Media | NYSE Composite vs. National CineMedia | NYSE Composite vs. Ubisoft Entertainment | NYSE Composite vs. Emerson Radio |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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