Correlation Between Calibre Mining and Metalero Mining
Can any of the company-specific risk be diversified away by investing in both Calibre Mining and Metalero 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 Metalero 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 Metalero Mining Corp, you can compare the effects of market volatilities on Calibre Mining and Metalero 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 Metalero Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calibre Mining and Metalero Mining.
Diversification Opportunities for Calibre Mining and Metalero Mining
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Calibre and Metalero is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Calibre Mining Corp and Metalero Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metalero Mining Corp 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 Metalero Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metalero Mining Corp has no effect on the direction of Calibre Mining i.e., Calibre Mining and Metalero Mining go up and down completely randomly.
Pair Corralation between Calibre Mining and Metalero Mining
Assuming the 90 days trading horizon Calibre Mining Corp is expected to generate 1.39 times more return on investment than Metalero Mining. However, Calibre Mining is 1.39 times more volatile than Metalero Mining Corp. It trades about 0.28 of its potential returns per unit of risk. Metalero Mining Corp is currently generating about 0.01 per unit of risk. If you would invest 216.00 in Calibre Mining Corp on October 28, 2024 and sell it today you would earn a total of 41.00 from holding Calibre Mining Corp or generate 18.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Calibre Mining Corp vs. Metalero Mining Corp
Performance |
| Timeline |
| Calibre Mining Corp |
| Metalero Mining Corp |
Calibre Mining and Metalero Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calibre Mining and Metalero Mining
The main advantage of trading using opposite Calibre Mining and Metalero Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calibre Mining position performs unexpectedly, Metalero 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 Metalero Mining will offset losses from the drop in Metalero Mining's long position.The idea behind Calibre Mining Corp and Metalero Mining Corp 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.| Metalero Mining vs. Newmont Goldcorp Corp | Metalero Mining vs. Agnico Eagle Mines | Metalero Mining vs. Barrick Gold Corp | Metalero Mining 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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