Correlation Between G III and CAL MAINE
Can any of the company-specific risk be diversified away by investing in both G III 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 G III and CAL MAINE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between G III Apparel Group and CAL MAINE FOODS, you can compare the effects of market volatilities on G III 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 G III with a short position of CAL MAINE. Check out your portfolio center. Please also check ongoing floating volatility patterns of G III and CAL MAINE.
Diversification Opportunities for G III and CAL MAINE
Very poor diversification
The 3 months correlation between GI4 and CAL is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding G III Apparel Group 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 G III 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 G III Apparel Group 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 G III i.e., G III and CAL MAINE go up and down completely randomly.
Pair Corralation between G III and CAL MAINE
Assuming the 90 days trading horizon G III is expected to generate 1.02 times less return on investment than CAL MAINE. In addition to that, G III is 1.57 times more volatile than CAL MAINE FOODS. It trades about 0.12 of its total potential returns per unit of risk. CAL MAINE FOODS is currently generating about 0.19 per unit of volatility. If you would invest 9,204 in CAL MAINE FOODS on October 1, 2024 and sell it today you would earn a total of 616.00 from holding CAL MAINE FOODS or generate 6.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
G III Apparel Group vs. CAL MAINE FOODS
Performance |
| Timeline |
| G III Apparel |
| CAL MAINE FOODS |
G III and CAL MAINE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with G III and CAL MAINE
The main advantage of trading using opposite G III and CAL MAINE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if G III 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.| G III vs. MARKET VECTR RETAIL | G III vs. Siamgas And Petrochemicals | G III vs. Laureate Education | G III vs. Tradegate AG Wertpapierhandelsbank |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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