Correlation Between OceanaGold and Calibre Mining
Can any of the company-specific risk be diversified away by investing in both OceanaGold and Calibre 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 OceanaGold and Calibre Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OceanaGold and Calibre Mining Corp, you can compare the effects of market volatilities on OceanaGold and Calibre 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 OceanaGold with a short position of Calibre Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of OceanaGold and Calibre Mining.
Diversification Opportunities for OceanaGold and Calibre Mining
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between OceanaGold and Calibre is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding OceanaGold and Calibre Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calibre Mining Corp and OceanaGold 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 OceanaGold are associated (or correlated) with Calibre Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calibre Mining Corp has no effect on the direction of OceanaGold i.e., OceanaGold and Calibre Mining go up and down completely randomly.
Pair Corralation between OceanaGold and Calibre Mining
Assuming the 90 days trading horizon OceanaGold is expected to generate 1.66 times less return on investment than Calibre Mining. But when comparing it to its historical volatility, OceanaGold is 1.11 times less risky than Calibre Mining. It trades about 0.05 of its potential returns per unit of risk. Calibre Mining Corp is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 100.00 in Calibre Mining Corp on November 2, 2024 and sell it today you would earn a total of 162.00 from holding Calibre Mining Corp or generate 162.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
OceanaGold vs. Calibre Mining Corp
Performance |
| Timeline |
| OceanaGold |
| Calibre Mining Corp |
OceanaGold and Calibre Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OceanaGold and Calibre Mining
The main advantage of trading using opposite OceanaGold and Calibre Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OceanaGold position performs unexpectedly, Calibre 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 Calibre Mining will offset losses from the drop in Calibre Mining's long position.| OceanaGold vs. Torex Gold Resources | OceanaGold vs. Wesdome Gold Mines | OceanaGold vs. Centerra Gold | OceanaGold vs. New 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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