Correlation Between Calibre Mining and InPlay Oil
Can any of the company-specific risk be diversified away by investing in both Calibre Mining and InPlay Oil 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 InPlay Oil 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 InPlay Oil Corp, you can compare the effects of market volatilities on Calibre Mining and InPlay Oil 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 InPlay Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calibre Mining and InPlay Oil.
Diversification Opportunities for Calibre Mining and InPlay Oil
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Calibre and InPlay is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Calibre Mining Corp and InPlay Oil Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on InPlay Oil 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 InPlay Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of InPlay Oil Corp has no effect on the direction of Calibre Mining i.e., Calibre Mining and InPlay Oil go up and down completely randomly.
Pair Corralation between Calibre Mining and InPlay Oil
Assuming the 90 days trading horizon Calibre Mining Corp is expected to generate 1.29 times more return on investment than InPlay Oil. However, Calibre Mining is 1.29 times more volatile than InPlay Oil Corp. It trades about 0.08 of its potential returns per unit of risk. InPlay Oil Corp is currently generating about -0.03 per unit of risk. If you would invest 123.00 in Calibre Mining Corp on October 13, 2024 and sell it today you would earn a total of 39.00 from holding Calibre Mining Corp or generate 31.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calibre Mining Corp vs. InPlay Oil Corp
Performance |
| Timeline |
| Calibre Mining Corp |
| InPlay Oil Corp |
Calibre Mining and InPlay Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calibre Mining and InPlay Oil
The main advantage of trading using opposite Calibre Mining and InPlay Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calibre Mining position performs unexpectedly, InPlay Oil 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 InPlay Oil will offset losses from the drop in InPlay Oil's long position.| Calibre Mining vs. Apple Inc | Calibre Mining vs. Apple Inc | Calibre Mining vs. Apple Inc | Calibre Mining vs. Apple Inc |
| InPlay Oil vs. MAGNUM MINING EXP | InPlay Oil vs. Calibre Mining Corp | InPlay Oil vs. SPORTING | InPlay Oil vs. JD SPORTS FASH |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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