Correlation Between Calibre Mining and ON THE

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

Diversification Opportunities for Calibre Mining and ON THE

-0.3

Correlation Coefficient

Calibre Mining  ON THE

Very good diversification

The 3 months correlation between Calibre and 9BP is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Calibre Mining Corp and ON THE BEACH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ON THE BEACH 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 ON THE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ON THE BEACH has no effect on the direction of Calibre Mining i.e., Calibre Mining and ON THE go up and down completely randomly.

Pair Corralation between Calibre Mining and ON THE

Assuming the 90 days trading horizon Calibre Mining Corp is expected to under-perform the ON THE. But the stock apears to be less risky and, when comparing its historical volatility, Calibre Mining Corp is 1.62 times less risky than ON THE. The stock trades about 0.0 of its potential returns per unit of risk. The ON THE BEACH is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest  178.00  in ON THE BEACH on October 7, 2024 and sell it today you would earn a total of  120.00  from holding ON THE BEACH or generate 67.42% 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.  ON THE BEACH

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 uncertain performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

ON THE BEACH

Risk-Adjusted Performance

21 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in ON THE BEACH are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, ON THE reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Calibre Mining and ON THE

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

The idea behind Calibre Mining Corp and ON THE BEACH 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.