Correlation Between Calibre Mining and Ping An
Can any of the company-specific risk be diversified away by investing in both Calibre Mining and Ping An 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 Ping An 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 Ping An Insurance, you can compare the effects of market volatilities on Calibre Mining and Ping An 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 Ping An. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calibre Mining and Ping An.
Diversification Opportunities for Calibre Mining and Ping An
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Calibre and Ping is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Calibre Mining Corp and Ping An Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ping An Insurance 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 Ping An. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ping An Insurance has no effect on the direction of Calibre Mining i.e., Calibre Mining and Ping An go up and down completely randomly.
Pair Corralation between Calibre Mining and Ping An
Assuming the 90 days trading horizon Calibre Mining Corp is expected to under-perform the Ping An. But the stock apears to be less risky and, when comparing its historical volatility, Calibre Mining Corp is 1.12 times less risky than Ping An. The stock trades about -0.15 of its potential returns per unit of risk. The Ping An Insurance is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 584.00 in Ping An Insurance on August 24, 2024 and sell it today you would lose (19.00) from holding Ping An Insurance or give up 3.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calibre Mining Corp vs. Ping An Insurance
Performance |
| Timeline |
| Calibre Mining Corp |
| Ping An Insurance |
Calibre Mining and Ping An Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calibre Mining and Ping An
The main advantage of trading using opposite Calibre Mining and Ping An positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calibre Mining position performs unexpectedly, Ping An 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 Ping An will offset losses from the drop in Ping An's long position.| Calibre Mining vs. Apple Inc | Calibre Mining vs. Apple Inc | Calibre Mining vs. Apple Inc | Calibre Mining vs. Apple Inc |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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