Correlation Between Cal-Maine Foods and EAST SIDE
Can any of the company-specific risk be diversified away by investing in both Cal-Maine Foods and EAST SIDE 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 EAST SIDE 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 EAST SIDE GAMES, you can compare the effects of market volatilities on Cal-Maine Foods and EAST SIDE 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 EAST SIDE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cal-Maine Foods and EAST SIDE.
Diversification Opportunities for Cal-Maine Foods and EAST SIDE
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cal-Maine and EAST is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Cal Maine Foods and EAST SIDE GAMES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EAST SIDE GAMES 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 EAST SIDE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EAST SIDE GAMES has no effect on the direction of Cal-Maine Foods i.e., Cal-Maine Foods and EAST SIDE go up and down completely randomly.
Pair Corralation between Cal-Maine Foods and EAST SIDE
Assuming the 90 days horizon Cal Maine Foods is expected to generate 0.37 times more return on investment than EAST SIDE. However, Cal Maine Foods is 2.71 times less risky than EAST SIDE. It trades about 0.17 of its potential returns per unit of risk. EAST SIDE GAMES is currently generating about -0.03 per unit of risk. If you would invest 5,496 in Cal Maine Foods on September 3, 2024 and sell it today you would earn a total of 3,844 from holding Cal Maine Foods or generate 69.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cal Maine Foods vs. EAST SIDE GAMES
Performance |
| Timeline |
| Cal Maine Foods |
| EAST SIDE GAMES |
Cal-Maine Foods and EAST SIDE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cal-Maine Foods and EAST SIDE
The main advantage of trading using opposite Cal-Maine Foods and EAST SIDE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cal-Maine Foods position performs unexpectedly, EAST SIDE 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 EAST SIDE will offset losses from the drop in EAST SIDE's long position.| Cal-Maine Foods vs. Ming Le Sports | Cal-Maine Foods vs. Universal Display | Cal-Maine Foods vs. PARKEN Sport Entertainment | Cal-Maine Foods vs. USWE SPORTS AB |
| EAST SIDE vs. Nintendo Co | EAST SIDE vs. Nintendo Co | EAST SIDE vs. Sea Limited | EAST SIDE vs. Take Two Interactive Software |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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