Correlation Between Calibre Mining and BROADWIND ENRGY

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

Diversification Opportunities for Calibre Mining and BROADWIND ENRGY

-0.7

Correlation Coefficient

Calibre Mining  BROADWIND ENRGY

Excellent diversification

The 3 months correlation between Calibre and BROADWIND is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Calibre Mining Corp and BROADWIND ENRGY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BROADWIND ENRGY 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 BROADWIND ENRGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BROADWIND ENRGY has no effect on the direction of Calibre Mining i.e., Calibre Mining and BROADWIND ENRGY go up and down completely randomly.

Pair Corralation between Calibre Mining and BROADWIND ENRGY

Assuming the 90 days trading horizon Calibre Mining Corp is expected to generate 0.87 times more return on investment than BROADWIND ENRGY. However, Calibre Mining Corp is 1.15 times less risky than BROADWIND ENRGY. It trades about 0.22 of its potential returns per unit of risk. BROADWIND ENRGY is currently generating about -0.13 per unit of risk. If you would invest  142.00  in Calibre Mining Corp on December 25, 2024 and sell it today you would earn a total of  63.00  from holding Calibre Mining Corp or generate 44.37% return on investment over 90 days.

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

Calibre Mining Corp  vs.  BROADWIND ENRGY

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 rather fragile technical and fundamental indicators, Calibre Mining exhibited solid returns over the last few months and may actually be approaching a breakup point.

BROADWIND ENRGY

Risk-Adjusted Performance

Very Weak

Over the last 90 days BROADWIND ENRGY has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Calibre Mining and BROADWIND ENRGY

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

The idea behind Calibre Mining Corp and BROADWIND ENRGY 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.