Correlation Between NISSIN FOODS and Calibre Mining

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

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

Diversification Opportunities for NISSIN FOODS and Calibre Mining

0.8

Correlation Coefficient

NISSIN FOODS  Calibre Mining

Very poor diversification

The 3 months correlation between NISSIN and Calibre is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding NISSIN FOODS HLDGS 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 NISSIN FOODS 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 NISSIN FOODS HLDGS 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 NISSIN FOODS i.e., NISSIN FOODS and Calibre Mining go up and down completely randomly.

Pair Corralation between NISSIN FOODS and Calibre Mining

Assuming the 90 days trading horizon NISSIN FOODS HLDGS is expected to generate 0.78 times more return on investment than Calibre Mining. However, NISSIN FOODS HLDGS is 1.28 times less risky than Calibre Mining. It trades about 0.01 of its potential returns per unit of risk. Calibre Mining Corp is currently generating about -0.05 per unit of risk. If you would invest  2,520  in NISSIN FOODS HLDGS on September 4, 2024 and sell it today you would earn a total of  0.00  from holding NISSIN FOODS HLDGS or generate 0.0% return on investment over 90 days.

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

NISSIN FOODS HLDGS  vs.  Calibre Mining Corp

NISSIN FOODS HLDGS

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in NISSIN FOODS HLDGS are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, NISSIN FOODS may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Calibre Mining Corp

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Calibre Mining Corp are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Calibre Mining exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with NISSIN FOODS and Calibre Mining

The main advantage of trading using opposite NISSIN FOODS and Calibre Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NISSIN FOODS 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 NISSIN FOODS HLDGS 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.