Correlation Between Calibre Mining and Aluminumof China
Can any of the company-specific risk be diversified away by investing in both Calibre Mining and Aluminumof China 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 Aluminumof China 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 Aluminum of, you can compare the effects of market volatilities on Calibre Mining and Aluminumof China 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 Aluminumof China. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calibre Mining and Aluminumof China.
Diversification Opportunities for Calibre Mining and Aluminumof China
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Calibre and Aluminumof is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Calibre Mining Corp and Aluminum of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aluminumof China 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 Aluminumof China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aluminumof China has no effect on the direction of Calibre Mining i.e., Calibre Mining and Aluminumof China go up and down completely randomly.
Pair Corralation between Calibre Mining and Aluminumof China
Assuming the 90 days trading horizon Calibre Mining is expected to generate 1.21 times less return on investment than Aluminumof China. But when comparing it to its historical volatility, Calibre Mining Corp is 1.69 times less risky than Aluminumof China. It trades about 0.05 of its potential returns per unit of risk. Aluminum of is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 54.00 in Aluminum of on September 2, 2024 and sell it today you would earn a total of 1.00 from holding Aluminum of or generate 1.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calibre Mining Corp vs. Aluminum of
Performance |
| Timeline |
| Calibre Mining Corp |
| Aluminumof China |
Calibre Mining and Aluminumof China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calibre Mining and Aluminumof China
The main advantage of trading using opposite Calibre Mining and Aluminumof China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calibre Mining position performs unexpectedly, Aluminumof China 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 Aluminumof China will offset losses from the drop in Aluminumof China's long position.| Calibre Mining vs. JSC Halyk bank | Calibre Mining vs. Webster Financial | Calibre Mining vs. Japan Asia Investment | Calibre Mining vs. Mizuho Financial Group |
| Aluminumof China vs. Westinghouse Air Brake | Aluminumof China vs. KIMBALL ELECTRONICS | Aluminumof China vs. Richardson Electronics | Aluminumof China vs. Arrow Electronics |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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