Correlation Between SLC Agricola and Cal Maine
Can any of the company-specific risk be diversified away by investing in both SLC Agricola 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 SLC Agricola and Cal Maine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SLC Agricola SA and Cal Maine Foods, you can compare the effects of market volatilities on SLC Agricola 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 SLC Agricola with a short position of Cal Maine. Check out your portfolio center. Please also check ongoing floating volatility patterns of SLC Agricola and Cal Maine.
Diversification Opportunities for SLC Agricola and Cal Maine
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SLC and Cal is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding SLC Agricola SA 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 SLC Agricola 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 SLC Agricola SA 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 SLC Agricola i.e., SLC Agricola and Cal Maine go up and down completely randomly.
Pair Corralation between SLC Agricola and Cal Maine
Assuming the 90 days horizon SLC Agricola SA is expected to generate 11.11 times more return on investment than Cal Maine. However, SLC Agricola is 11.11 times more volatile than Cal Maine Foods. It trades about 0.07 of its potential returns per unit of risk. Cal Maine Foods is currently generating about 0.07 per unit of risk. If you would invest 331.00 in SLC Agricola SA on August 24, 2024 and sell it today you would lose (46.00) from holding SLC Agricola SA or give up 13.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.59% |
| Values | Daily Returns |
SLC Agricola SA vs. Cal Maine Foods
Performance |
| Timeline |
| SLC Agricola SA |
| Cal Maine Foods |
SLC Agricola and Cal Maine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SLC Agricola and Cal Maine
The main advantage of trading using opposite SLC Agricola and Cal Maine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SLC Agricola 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.| SLC Agricola vs. Avi Ltd ADR | SLC Agricola vs. Altavoz Entertainment | SLC Agricola vs. The a2 Milk | SLC Agricola vs. Aryzta AG PK |
| Cal Maine vs. Bunge Limited | Cal Maine vs. Tyson Foods | Cal Maine vs. Dole PLC | Cal Maine vs. Adecoagro SA |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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