Correlation Between Cal-Maine Foods and MYFAIR GOLD
Can any of the company-specific risk be diversified away by investing in both Cal-Maine Foods and MYFAIR GOLD 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 Foods and MYFAIR GOLD 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 MYFAIR GOLD P, you can compare the effects of market volatilities on Cal-Maine Foods and MYFAIR GOLD 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 Foods with a short position of MYFAIR GOLD. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cal-Maine Foods and MYFAIR GOLD.
Diversification Opportunities for Cal-Maine Foods and MYFAIR GOLD
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Cal-Maine and MYFAIR is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Cal Maine Foods and MYFAIR GOLD P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MYFAIR GOLD P and Cal-Maine 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 Cal Maine Foods are associated (or correlated) with MYFAIR GOLD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MYFAIR GOLD P has no effect on the direction of Cal-Maine Foods i.e., Cal-Maine Foods and MYFAIR GOLD go up and down completely randomly.
Pair Corralation between Cal-Maine Foods and MYFAIR GOLD
Assuming the 90 days horizon Cal Maine Foods is expected to generate 0.43 times more return on investment than MYFAIR GOLD. However, Cal Maine Foods is 2.35 times less risky than MYFAIR GOLD. It trades about 0.23 of its potential returns per unit of risk. MYFAIR GOLD P is currently generating about -0.01 per unit of risk. If you would invest 8,282 in Cal Maine Foods on August 29, 2024 and sell it today you would earn a total of 790.00 from holding Cal Maine Foods or generate 9.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cal Maine Foods vs. MYFAIR GOLD P
Performance |
| Timeline |
| Cal Maine Foods |
| MYFAIR GOLD P |
Cal-Maine Foods and MYFAIR GOLD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cal-Maine Foods and MYFAIR GOLD
The main advantage of trading using opposite Cal-Maine Foods and MYFAIR GOLD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cal-Maine Foods position performs unexpectedly, MYFAIR GOLD 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 MYFAIR GOLD will offset losses from the drop in MYFAIR GOLD's long position.| Cal-Maine Foods vs. Superior Plus Corp | Cal-Maine Foods vs. NMI Holdings | Cal-Maine Foods vs. Origin Agritech | Cal-Maine Foods vs. SIVERS SEMICONDUCTORS AB |
| MYFAIR GOLD vs. Franco Nevada | MYFAIR GOLD vs. Agnico Eagle Mines | MYFAIR GOLD vs. Superior Plus Corp | MYFAIR GOLD vs. NMI Holdings |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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