Correlation Between Calibre Mining and K92 Mining
Can any of the company-specific risk be diversified away by investing in both Calibre Mining and K92 Mining 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 K92 Mining 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 K92 Mining, you can compare the effects of market volatilities on Calibre Mining and K92 Mining 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 K92 Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calibre Mining and K92 Mining.
Diversification Opportunities for Calibre Mining and K92 Mining
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Calibre and K92 is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Calibre Mining Corp and K92 Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on K92 Mining 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 K92 Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of K92 Mining has no effect on the direction of Calibre Mining i.e., Calibre Mining and K92 Mining go up and down completely randomly.
Pair Corralation between Calibre Mining and K92 Mining
Assuming the 90 days trading horizon Calibre Mining Corp is expected to under-perform the K92 Mining. In addition to that, Calibre Mining is 1.03 times more volatile than K92 Mining. It trades about -0.06 of its total potential returns per unit of risk. K92 Mining is currently generating about -0.01 per unit of volatility. If you would invest 915.00 in K92 Mining on August 29, 2024 and sell it today you would lose (11.00) from holding K92 Mining or give up 1.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calibre Mining Corp vs. K92 Mining
Performance |
| Timeline |
| Calibre Mining Corp |
| K92 Mining |
Calibre Mining and K92 Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calibre Mining and K92 Mining
The main advantage of trading using opposite Calibre Mining and K92 Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calibre Mining position performs unexpectedly, K92 Mining 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 K92 Mining will offset losses from the drop in K92 Mining's long position.The idea behind Calibre Mining Corp and K92 Mining 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.| K92 Mining vs. Calibre Mining Corp | K92 Mining vs. Wesdome Gold Mines | K92 Mining vs. Equinox Gold Corp | K92 Mining vs. Orla Mining |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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