Correlation Between Calibre Mining and Stag Industrial

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

Diversification Opportunities for Calibre Mining and Stag Industrial

0.49

Correlation Coefficient

Calibre Mining  Stag Industrial

Very weak diversification

The 3 months correlation between Calibre and Stag is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Calibre Mining Corp and Stag Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stag Industrial 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 Stag Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stag Industrial has no effect on the direction of Calibre Mining i.e., Calibre Mining and Stag Industrial go up and down completely randomly.

Pair Corralation between Calibre Mining and Stag Industrial

Assuming the 90 days trading horizon Calibre Mining Corp is expected to generate 2.04 times more return on investment than Stag Industrial. However, Calibre Mining is 2.04 times more volatile than Stag Industrial. It trades about 0.07 of its potential returns per unit of risk. Stag Industrial is currently generating about 0.02 per unit of risk. If you would invest  71.00  in Calibre Mining Corp on October 25, 2024 and sell it today you would earn a total of  94.00  from holding Calibre Mining Corp or generate 132.39% return on investment over 90 days.

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

Calibre Mining Corp  vs.  Stag Industrial

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 rather sound technical and fundamental indicators, Calibre Mining is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Stag Industrial

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Stag Industrial has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Stag Industrial is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Calibre Mining and Stag Industrial

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

The idea behind Calibre Mining Corp and Stag Industrial 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.