Correlation Between Canadian Imperial and Agnico Eagle
Can any of the company-specific risk be diversified away by investing in both Canadian Imperial 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 Canadian Imperial and Agnico Eagle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Canadian Imperial Bank and Agnico Eagle Mines, you can compare the effects of market volatilities on Canadian Imperial 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 Canadian Imperial with a short position of Agnico Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canadian Imperial and Agnico Eagle.
Diversification Opportunities for Canadian Imperial and Agnico Eagle
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Canadian and Agnico is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Canadian Imperial Bank 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 Canadian Imperial 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 Canadian Imperial Bank 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 Canadian Imperial i.e., Canadian Imperial and Agnico Eagle go up and down completely randomly.
Pair Corralation between Canadian Imperial and Agnico Eagle
If you would invest 6,521 in Agnico Eagle Mines on February 20, 2024 and sell it today you would earn a total of 3,023 from holding Agnico Eagle Mines or generate 46.36% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Canadian Imperial Bank vs. Agnico Eagle Mines
Performance |
Timeline |
Canadian Imperial Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Agnico Eagle Mines |
Canadian Imperial and Agnico Eagle Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Canadian Imperial and Agnico Eagle
The main advantage of trading using opposite Canadian Imperial and Agnico Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canadian Imperial 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.The idea behind Canadian Imperial Bank and Agnico Eagle Mines 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.Agnico Eagle vs. Franco Nevada | Agnico Eagle vs. Kinross Gold Corp | Agnico Eagle vs. Barrick Gold Corp | Agnico Eagle vs. Wheaton Precious Metals |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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