Correlation Between MICRONIC MYDATA and Calibre Mining

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

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

Diversification Opportunities for MICRONIC MYDATA and Calibre Mining

-0.33

Correlation Coefficient

MICRONIC MYDATA  Calibre Mining

Very good diversification

The 3 months correlation between MICRONIC and Calibre is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding MICRONIC MYDATA 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 MICRONIC MYDATA 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 MICRONIC MYDATA 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 MICRONIC MYDATA i.e., MICRONIC MYDATA and Calibre Mining go up and down completely randomly.

Pair Corralation between MICRONIC MYDATA and Calibre Mining

Assuming the 90 days trading horizon MICRONIC MYDATA is expected to generate 0.88 times more return on investment than Calibre Mining. However, MICRONIC MYDATA is 1.14 times less risky than Calibre Mining. It trades about 0.09 of its potential returns per unit of risk. Calibre Mining Corp is currently generating about 0.07 per unit of risk. If you would invest  1,399  in MICRONIC MYDATA on October 22, 2024 and sell it today you would earn a total of  2,355  from holding MICRONIC MYDATA or generate 168.33% return on investment over 90 days.

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

MICRONIC MYDATA  vs.  Calibre Mining Corp

MICRONIC MYDATA

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in MICRONIC MYDATA are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, MICRONIC MYDATA exhibited solid returns over the last few months and may actually be approaching a breakup point.

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 latest unsteady performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with MICRONIC MYDATA and Calibre Mining

The main advantage of trading using opposite MICRONIC MYDATA and Calibre Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MICRONIC MYDATA 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 MICRONIC MYDATA 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.