Correlation Between MEDICAL FACILITIES and Calibre Mining

Can any of the company-specific risk be diversified away by investing in both MEDICAL FACILITIES and Calibre Mining 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 MEDICAL FACILITIES and Calibre Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between MEDICAL FACILITIES NEW and Calibre Mining Corp, you can compare the effects of market volatilities on MEDICAL FACILITIES and Calibre Mining 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 MEDICAL FACILITIES with a short position of Calibre Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of MEDICAL FACILITIES and Calibre Mining.

Diversification Opportunities for MEDICAL FACILITIES and Calibre Mining

0.38

Correlation Coefficient

MEDICAL FACILITIES  Calibre Mining

Weak diversification

The 3 months correlation between MEDICAL and Calibre is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding MEDICAL FACILITIES NEW and Calibre Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calibre Mining Corp and MEDICAL FACILITIES 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 MEDICAL FACILITIES NEW are associated (or correlated) with Calibre Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calibre Mining Corp has no effect on the direction of MEDICAL FACILITIES i.e., MEDICAL FACILITIES and Calibre Mining go up and down completely randomly.

Pair Corralation between MEDICAL FACILITIES and Calibre Mining

Assuming the 90 days horizon MEDICAL FACILITIES is expected to generate 50.73 times less return on investment than Calibre Mining. In addition to that, MEDICAL FACILITIES is 1.34 times more volatile than Calibre Mining Corp. It trades about 0.0 of its total potential returns per unit of risk. Calibre Mining Corp is currently generating about 0.2 per unit of volatility. If you would invest  144.00  in Calibre Mining Corp on December 22, 2024 and sell it today you would earn a total of  55.00  from holding Calibre Mining Corp or generate 38.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

MEDICAL FACILITIES NEW  vs.  Calibre Mining Corp

MEDICAL FACILITIES NEW

Risk-Adjusted Performance

Very Weak

Over the last 90 days MEDICAL FACILITIES NEW has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, MEDICAL FACILITIES is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Calibre Mining Corp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Calibre Mining Corp are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile technical and fundamental indicators, Calibre Mining exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with MEDICAL FACILITIES and Calibre Mining

The main advantage of trading using opposite MEDICAL FACILITIES and Calibre Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MEDICAL FACILITIES position performs unexpectedly, Calibre Mining 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 Calibre Mining will offset losses from the drop in Calibre Mining's long position.

The idea behind MEDICAL FACILITIES NEW and Calibre Mining Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.