Correlation Between Calibre Mining and Fairfax Financial
Can any of the company-specific risk be diversified away by investing in both Calibre Mining and Fairfax Financial 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 Calibre Mining and Fairfax Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calibre Mining Corp and Fairfax Financial Holdings, you can compare the effects of market volatilities on Calibre Mining and Fairfax Financial 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 Calibre Mining with a short position of Fairfax Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calibre Mining and Fairfax Financial.
Diversification Opportunities for Calibre Mining and Fairfax Financial
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Calibre and Fairfax is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Calibre Mining Corp and Fairfax Financial Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fairfax Financial and Calibre Mining 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 Calibre Mining Corp are associated (or correlated) with Fairfax Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fairfax Financial has no effect on the direction of Calibre Mining i.e., Calibre Mining and Fairfax Financial go up and down completely randomly.
Pair Corralation between Calibre Mining and Fairfax Financial
Assuming the 90 days trading horizon Calibre Mining Corp is expected to generate 2.8 times more return on investment than Fairfax Financial. However, Calibre Mining is 2.8 times more volatile than Fairfax Financial Holdings. It trades about 0.07 of its potential returns per unit of risk. Fairfax Financial Holdings is currently generating about 0.09 per unit of risk. If you would invest 110.00 in Calibre Mining Corp on October 13, 2024 and sell it today you would earn a total of 127.00 from holding Calibre Mining Corp or generate 115.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calibre Mining Corp vs. Fairfax Financial Holdings
Performance |
| Timeline |
| Calibre Mining Corp |
| Fairfax Financial |
Calibre Mining and Fairfax Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calibre Mining and Fairfax Financial
The main advantage of trading using opposite Calibre Mining and Fairfax Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calibre Mining position performs unexpectedly, Fairfax Financial 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 Fairfax Financial will offset losses from the drop in Fairfax Financial's long position.The idea behind Calibre Mining Corp and Fairfax Financial Holdings 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.| Fairfax Financial vs. Ramp Metals | Fairfax Financial vs. QC Copper and | Fairfax Financial vs. Calibre Mining Corp | Fairfax Financial vs. Pembina Pipeline Corp |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |