Correlation Between Calibre Mining and Silver Range

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

Diversification Opportunities for Calibre Mining and Silver Range

0.32

Correlation Coefficient

Calibre Mining  Silver Range

Weak diversification

The 3 months correlation between Calibre and Silver is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Calibre Mining Corp and Silver Range Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silver Range Resources 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 Silver Range. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silver Range Resources has no effect on the direction of Calibre Mining i.e., Calibre Mining and Silver Range go up and down completely randomly.

Pair Corralation between Calibre Mining and Silver Range

Assuming the 90 days trading horizon Calibre Mining Corp is expected to generate 0.42 times more return on investment than Silver Range. However, Calibre Mining Corp is 2.36 times less risky than Silver Range. It trades about 0.01 of its potential returns per unit of risk. Silver Range Resources is currently generating about -0.02 per unit of risk. If you would invest  255.00  in Calibre Mining Corp on October 26, 2024 and sell it today you would lose (4.00) from holding Calibre Mining Corp or give up 1.57% 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.  Silver Range Resources

Calibre Mining Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Calibre Mining Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental drivers, Calibre Mining is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Silver Range Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Silver Range Resources has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Pair Trading with Calibre Mining and Silver Range

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

The idea behind Calibre Mining Corp and Silver Range Resources 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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.