Correlation Between Superior Plus and Cal Maine
Can any of the company-specific risk be diversified away by investing in both Superior Plus and Cal Maine 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 Superior Plus and Cal Maine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Superior Plus Corp and Cal Maine Foods, you can compare the effects of market volatilities on Superior Plus and Cal Maine 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 Superior Plus with a short position of Cal Maine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Superior Plus and Cal Maine.
Diversification Opportunities for Superior Plus and Cal Maine
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Superior and Cal is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Superior Plus Corp and Cal Maine Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cal Maine Foods and Superior Plus 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 Superior Plus Corp are associated (or correlated) with Cal Maine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cal Maine Foods has no effect on the direction of Superior Plus i.e., Superior Plus and Cal Maine go up and down completely randomly.
Pair Corralation between Superior Plus and Cal Maine
Assuming the 90 days horizon Superior Plus Corp is expected to under-perform the Cal Maine. But the stock apears to be less risky and, when comparing its historical volatility, Superior Plus Corp is 1.06 times less risky than Cal Maine. The stock trades about -0.03 of its potential returns per unit of risk. The Cal Maine Foods is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 4,813 in Cal Maine Foods on November 19, 2024 and sell it today you would earn a total of 4,277 from holding Cal Maine Foods or generate 88.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Superior Plus Corp vs. Cal Maine Foods
Performance |
| Timeline |
| Superior Plus Corp |
| Cal Maine Foods |
Superior Plus and Cal Maine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Superior Plus and Cal Maine
The main advantage of trading using opposite Superior Plus and Cal Maine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Superior Plus position performs unexpectedly, Cal Maine 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 Cal Maine will offset losses from the drop in Cal Maine's long position.| Superior Plus vs. DEVRY EDUCATION GRP | Superior Plus vs. CHINA EDUCATION GROUP | Superior Plus vs. CAREER EDUCATION | Superior Plus vs. DeVry Education Group |
| Cal Maine vs. PLAYTECH | Cal Maine vs. MINCO SILVER | Cal Maine vs. ANGLO ASIAN MINING | Cal Maine vs. ARISTOCRAT LEISURE |
Check out your portfolio center.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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Commodity Directory Find actively traded commodities issued by global exchanges |