Correlation Between Avino Silver and Dolly Varden
Can any of the company-specific risk be diversified away by investing in both Avino Silver and Dolly Varden 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 Avino Silver and Dolly Varden into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Avino Silver Gold and Dolly Varden Silver, you can compare the effects of market volatilities on Avino Silver and Dolly Varden 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 Avino Silver with a short position of Dolly Varden. Check out your portfolio center. Please also check ongoing floating volatility patterns of Avino Silver and Dolly Varden.
Diversification Opportunities for Avino Silver and Dolly Varden
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Avino and Dolly is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Avino Silver Gold and Dolly Varden Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dolly Varden Silver and Avino Silver 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 Avino Silver Gold are associated (or correlated) with Dolly Varden. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dolly Varden Silver has no effect on the direction of Avino Silver i.e., Avino Silver and Dolly Varden go up and down completely randomly.
Pair Corralation between Avino Silver and Dolly Varden
Assuming the 90 days trading horizon Avino Silver Gold is expected to generate 1.16 times more return on investment than Dolly Varden. However, Avino Silver is 1.16 times more volatile than Dolly Varden Silver. It trades about 0.2 of its potential returns per unit of risk. Dolly Varden Silver is currently generating about 0.21 per unit of risk. If you would invest 79.00 in Avino Silver Gold on January 26, 2024 and sell it today you would earn a total of 18.00 from holding Avino Silver Gold or generate 22.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Avino Silver Gold vs. Dolly Varden Silver
Performance |
| Timeline |
| Avino Silver Gold |
| Dolly Varden Silver |
Avino Silver and Dolly Varden Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Avino Silver and Dolly Varden
The main advantage of trading using opposite Avino Silver and Dolly Varden positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Avino Silver position performs unexpectedly, Dolly Varden 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 Dolly Varden will offset losses from the drop in Dolly Varden's long position.| Avino Silver vs. Maple Leaf Foods | Avino Silver vs. Flow Beverage Corp | Avino Silver vs. East Africa Metals | Avino Silver vs. High Liner Foods |
| Dolly Varden vs. Defiance Silver Corp | Dolly Varden vs. Metallic Minerals Corp | Dolly Varden vs. Kootenay Silver | Dolly Varden vs. Minaurum Gold |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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