Correlation Between Calibre Mining and SOUTHWEST AIRLINES

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

Diversification Opportunities for Calibre Mining and SOUTHWEST AIRLINES

0.29

Correlation Coefficient

Calibre Mining  SOUTHWEST AIRLINES

Modest diversification

The 3 months correlation between Calibre and SOUTHWEST is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Calibre Mining Corp and SOUTHWEST AIRLINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOUTHWEST AIRLINES 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 SOUTHWEST AIRLINES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOUTHWEST AIRLINES has no effect on the direction of Calibre Mining i.e., Calibre Mining and SOUTHWEST AIRLINES go up and down completely randomly.

Pair Corralation between Calibre Mining and SOUTHWEST AIRLINES

Assuming the 90 days trading horizon Calibre Mining Corp is expected to generate 1.2 times more return on investment than SOUTHWEST AIRLINES. However, Calibre Mining is 1.2 times more volatile than SOUTHWEST AIRLINES. It trades about 0.06 of its potential returns per unit of risk. SOUTHWEST AIRLINES is currently generating about 0.0 per unit of risk. If you would invest  98.00  in Calibre Mining Corp on March 24, 2025 and sell it today you would earn a total of  94.00  from holding Calibre Mining Corp or generate 95.92% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	99.8%
Values	Daily Returns

Calibre Mining Corp  vs.  SOUTHWEST AIRLINES

Calibre Mining Corp

Risk-Adjusted Performance

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 current stock price tumult, may contribute to shorter-term losses for the shareholders.

SOUTHWEST AIRLINES

Risk-Adjusted Performance

Very Weak

Over the last 90 days SOUTHWEST AIRLINES has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Calibre Mining and SOUTHWEST AIRLINES

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

The idea behind Calibre Mining Corp and SOUTHWEST AIRLINES 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.