Correlation Between Cal Maine and Ameren Illinois
Can any of the company-specific risk be diversified away by investing in both Cal Maine and Ameren Illinois 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 Cal Maine and Ameren Illinois into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cal Maine Foods and Ameren Illinois, you can compare the effects of market volatilities on Cal Maine and Ameren Illinois 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 Cal Maine with a short position of Ameren Illinois. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cal Maine and Ameren Illinois.
Diversification Opportunities for Cal Maine and Ameren Illinois
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cal and Ameren is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Cal Maine Foods and Ameren Illinois in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ameren Illinois and Cal Maine 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 Cal Maine Foods are associated (or correlated) with Ameren Illinois. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ameren Illinois has no effect on the direction of Cal Maine i.e., Cal Maine and Ameren Illinois go up and down completely randomly.
Pair Corralation between Cal Maine and Ameren Illinois
Given the investment horizon of 90 days Cal Maine Foods is expected to generate 3.16 times more return on investment than Ameren Illinois. However, Cal Maine is 3.16 times more volatile than Ameren Illinois. It trades about 0.02 of its potential returns per unit of risk. Ameren Illinois is currently generating about -0.11 per unit of risk. If you would invest 10,420 in Cal Maine Foods on October 11, 2024 and sell it today you would earn a total of 53.00 from holding Cal Maine Foods or generate 0.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cal Maine Foods vs. Ameren Illinois
Performance |
| Timeline |
| Cal Maine Foods |
| Ameren Illinois |
Cal Maine and Ameren Illinois Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cal Maine and Ameren Illinois
The main advantage of trading using opposite Cal Maine and Ameren Illinois positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cal Maine position performs unexpectedly, Ameren Illinois 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 Ameren Illinois will offset losses from the drop in Ameren Illinois' long position.| Cal Maine vs. Bunge Limited | Cal Maine vs. Tyson Foods | Cal Maine vs. Dole PLC | Cal Maine vs. Adecoagro SA |
| Ameren Illinois vs. Kodiak Gas Services, | Ameren Illinois vs. Cal Maine Foods | Ameren Illinois vs. Birkenstock Holding plc | Ameren Illinois vs. Rail Vision Ltd |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Global Correlations Find global opportunities by holding instruments from different markets |