Correlation Between Endeavour Silver and Avino Silver

Can any of the company-specific risk be diversified away by investing in both Endeavour Silver and Avino Silver 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 Endeavour Silver and Avino Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Endeavour Silver Corp and Avino Silver Gold, you can compare the effects of market volatilities on Endeavour Silver and Avino Silver 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 Endeavour Silver with a short position of Avino Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Endeavour Silver and Avino Silver.

Diversification Opportunities for Endeavour Silver and Avino Silver

0.74

Correlation Coefficient

Endeavour Silver  Avino Silver

Poor diversification

The 3 months correlation between Endeavour and Avino is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Endeavour Silver Corp and Avino Silver Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avino Silver Gold and Endeavour 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 Endeavour Silver Corp are associated (or correlated) with Avino Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avino Silver Gold has no effect on the direction of Endeavour Silver i.e., Endeavour Silver and Avino Silver go up and down completely randomly.

Pair Corralation between Endeavour Silver and Avino Silver

Considering the 90-day investment horizon Endeavour Silver Corp is expected to under-perform the Avino Silver. But the stock apears to be less risky and, when comparing its historical volatility, Endeavour Silver Corp is 1.02 times less risky than Avino Silver. The stock trades about -0.01 of its potential returns per unit of risk. The Avino Silver Gold is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  92.00  in Avino Silver Gold on January 8, 2025 and sell it today you would earn a total of  54.00  from holding Avino Silver Gold or generate 58.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Endeavour Silver Corp  vs.  Avino Silver Gold

Endeavour Silver Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Endeavour Silver Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Endeavour Silver is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Avino Silver Gold

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Avino Silver Gold are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting basic indicators, Avino Silver displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Endeavour Silver and Avino Silver

The main advantage of trading using opposite Endeavour Silver and Avino Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Endeavour Silver position performs unexpectedly, Avino Silver 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 Avino Silver will offset losses from the drop in Avino Silver's long position.

The idea behind Endeavour Silver Corp and Avino Silver Gold 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.

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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.