Correlation Between GUDANG GARAM and Cal-Maine Foods
Can any of the company-specific risk be diversified away by investing in both GUDANG GARAM and Cal-Maine Foods 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 GUDANG GARAM and Cal-Maine Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GUDANG GARAM and Cal Maine Foods, you can compare the effects of market volatilities on GUDANG GARAM and Cal-Maine Foods 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 GUDANG GARAM with a short position of Cal-Maine Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of GUDANG GARAM and Cal-Maine Foods.
Diversification Opportunities for GUDANG GARAM and Cal-Maine Foods
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GUDANG and Cal-Maine is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding GUDANG GARAM 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 GUDANG GARAM 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 GUDANG GARAM are associated (or correlated) with Cal-Maine Foods. 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 GUDANG GARAM i.e., GUDANG GARAM and Cal-Maine Foods go up and down completely randomly.
Pair Corralation between GUDANG GARAM and Cal-Maine Foods
Assuming the 90 days trading horizon GUDANG GARAM is expected to under-perform the Cal-Maine Foods. But the stock apears to be less risky and, when comparing its historical volatility, GUDANG GARAM is 1.19 times less risky than Cal-Maine Foods. The stock trades about -0.23 of its potential returns per unit of risk. The Cal Maine Foods is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 8,084 in Cal Maine Foods on September 1, 2024 and sell it today you would earn a total of 1,044 from holding Cal Maine Foods or generate 12.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
GUDANG GARAM vs. Cal Maine Foods
Performance |
| Timeline |
| GUDANG GARAM |
| Cal Maine Foods |
GUDANG GARAM and Cal-Maine Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GUDANG GARAM and Cal-Maine Foods
The main advantage of trading using opposite GUDANG GARAM and Cal-Maine Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GUDANG GARAM position performs unexpectedly, Cal-Maine Foods 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 Foods will offset losses from the drop in Cal-Maine Foods' long position.| GUDANG GARAM vs. SIVERS SEMICONDUCTORS AB | GUDANG GARAM vs. Darden Restaurants | GUDANG GARAM vs. Reliance Steel Aluminum | GUDANG GARAM vs. Q2M Managementberatung AG |
| Cal-Maine Foods vs. Gamma Communications plc | Cal-Maine Foods vs. Cogent Communications Holdings | Cal-Maine Foods vs. Entravision Communications | Cal-Maine Foods vs. Highlight Communications AG |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| CEOs Directory Screen CEOs from public companies around the world |