Correlation Between Calibre Mining and Vonovia SE
Can any of the company-specific risk be diversified away by investing in both Calibre Mining and Vonovia SE 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 Vonovia SE 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 Vonovia SE, you can compare the effects of market volatilities on Calibre Mining and Vonovia SE 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 Vonovia SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calibre Mining and Vonovia SE.
Diversification Opportunities for Calibre Mining and Vonovia SE
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Calibre and Vonovia is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Calibre Mining Corp and Vonovia SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vonovia SE 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 Vonovia SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vonovia SE has no effect on the direction of Calibre Mining i.e., Calibre Mining and Vonovia SE go up and down completely randomly.
Pair Corralation between Calibre Mining and Vonovia SE
Assuming the 90 days trading horizon Calibre Mining Corp is expected to generate 1.01 times more return on investment than Vonovia SE. However, Calibre Mining is 1.01 times more volatile than Vonovia SE. It trades about 0.4 of its potential returns per unit of risk. Vonovia SE is currently generating about 0.07 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 23.00 from holding Calibre Mining Corp or generate 16.2% 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. Vonovia SE
Performance |
| Timeline |
| Calibre Mining Corp |
| Vonovia SE |
Calibre Mining and Vonovia SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calibre Mining and Vonovia SE
The main advantage of trading using opposite Calibre Mining and Vonovia SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calibre Mining position performs unexpectedly, Vonovia SE 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 Vonovia SE will offset losses from the drop in Vonovia SE's long position.| Calibre Mining vs. Apple Inc | Calibre Mining vs. Apple Inc | Calibre Mining vs. Apple Inc | Calibre Mining vs. Apple Inc |
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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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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