Correlation Between Calibre Mining and Renoworks Software

Can any of the company-specific risk be diversified away by investing in both Calibre Mining and Renoworks Software 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 Renoworks Software 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 Renoworks Software, you can compare the effects of market volatilities on Calibre Mining and Renoworks Software 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 Renoworks Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calibre Mining and Renoworks Software.

Diversification Opportunities for Calibre Mining and Renoworks Software

-0.1

Correlation Coefficient

Calibre Mining  Renoworks Software

Good diversification

The 3 months correlation between Calibre and Renoworks is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Calibre Mining Corp and Renoworks Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Renoworks Software 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 Renoworks Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Renoworks Software has no effect on the direction of Calibre Mining i.e., Calibre Mining and Renoworks Software go up and down completely randomly.

Pair Corralation between Calibre Mining and Renoworks Software

Assuming the 90 days trading horizon Calibre Mining Corp is expected to generate 0.9 times more return on investment than Renoworks Software. However, Calibre Mining Corp is 1.11 times less risky than Renoworks Software. It trades about 0.22 of its potential returns per unit of risk. Renoworks Software is currently generating about -0.08 per unit of risk. If you would invest  213.00  in Calibre Mining Corp on December 21, 2024 and sell it today you would earn a total of  99.00  from holding Calibre Mining Corp or generate 46.48% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Calibre Mining Corp  vs.  Renoworks Software

Calibre Mining Corp

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Calibre Mining Corp are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating fundamental drivers, Calibre Mining displayed solid returns over the last few months and may actually be approaching a breakup point.

Renoworks Software

Risk-Adjusted Performance

Very Weak

Over the last 90 days Renoworks Software has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Calibre Mining and Renoworks Software

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

The idea behind Calibre Mining Corp and Renoworks Software 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.