Correlation Between Calibre Mining and McPhy Energy
Can any of the company-specific risk be diversified away by investing in both Calibre Mining and McPhy Energy 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 McPhy Energy 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 McPhy Energy SA, you can compare the effects of market volatilities on Calibre Mining and McPhy Energy 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 McPhy Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calibre Mining and McPhy Energy.
Diversification Opportunities for Calibre Mining and McPhy Energy
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Calibre and McPhy is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Calibre Mining Corp and McPhy Energy SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on McPhy Energy SA 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 McPhy Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of McPhy Energy SA has no effect on the direction of Calibre Mining i.e., Calibre Mining and McPhy Energy go up and down completely randomly.
Pair Corralation between Calibre Mining and McPhy Energy
Assuming the 90 days trading horizon Calibre Mining Corp is expected to generate 0.27 times more return on investment than McPhy Energy. However, Calibre Mining Corp is 3.7 times less risky than McPhy Energy. It trades about 0.45 of its potential returns per unit of risk. McPhy Energy SA is currently generating about -0.23 per unit of risk. If you would invest 142.00 in Calibre Mining Corp on September 12, 2024 and sell it today you would earn a total of 28.00 from holding Calibre Mining Corp or generate 19.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Calibre Mining Corp vs. McPhy Energy SA
Performance |
| Timeline |
| Calibre Mining Corp |
| McPhy Energy SA |
Calibre Mining and McPhy Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calibre Mining and McPhy Energy
The main advantage of trading using opposite Calibre Mining and McPhy Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calibre Mining position performs unexpectedly, McPhy Energy 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 McPhy Energy will offset losses from the drop in McPhy Energy's long position.| Calibre Mining vs. Apple Inc | Calibre Mining vs. Apple Inc | Calibre Mining vs. Apple Inc | Calibre Mining vs. Apple Inc |
| McPhy Energy vs. Apollo Medical Holdings | McPhy Energy vs. MeVis Medical Solutions | McPhy Energy vs. SCANDMEDICAL SOLDK 040 | McPhy Energy vs. BURLINGTON STORES |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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