Correlation Between MAG SILVER and Cal Maine
Can any of the company-specific risk be diversified away by investing in both MAG SILVER 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 MAG SILVER and Cal Maine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MAG SILVER and Cal Maine Foods, you can compare the effects of market volatilities on MAG SILVER 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 MAG SILVER with a short position of Cal Maine. Check out your portfolio center. Please also check ongoing floating volatility patterns of MAG SILVER and Cal Maine.
Diversification Opportunities for MAG SILVER and Cal Maine
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MAG and Cal is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding MAG SILVER 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 MAG SILVER 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 MAG SILVER 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 MAG SILVER i.e., MAG SILVER and Cal Maine go up and down completely randomly.
Pair Corralation between MAG SILVER and Cal Maine
Assuming the 90 days trading horizon MAG SILVER is expected to under-perform the Cal Maine. But the stock apears to be less risky and, when comparing its historical volatility, MAG SILVER is 1.58 times less risky than Cal Maine. The stock trades about -0.19 of its potential returns per unit of risk. The Cal Maine Foods is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 10,055 in Cal Maine Foods on October 13, 2024 and sell it today you would earn a total of 295.00 from holding Cal Maine Foods or generate 2.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MAG SILVER vs. Cal Maine Foods
Performance |
| Timeline |
| MAG SILVER |
| Cal Maine Foods |
MAG SILVER and Cal Maine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MAG SILVER and Cal Maine
The main advantage of trading using opposite MAG SILVER and Cal Maine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MAG SILVER 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.| MAG SILVER vs. BioNTech SE | MAG SILVER vs. MAGIC SOFTWARE ENTR | MAG SILVER vs. Alfa Financial Software | MAG SILVER vs. NetSol Technologies |
| Cal Maine vs. Chunghwa Telecom Co | Cal Maine vs. Singapore Telecommunications Limited | Cal Maine vs. Perseus Mining Limited | Cal Maine vs. MAG SILVER |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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