Correlation Between CAL-MAINE FOODS and SENECA FOODS-A
Can any of the company-specific risk be diversified away by investing in both CAL-MAINE FOODS and SENECA FOODS-A 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 SENECA FOODS-A 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 SENECA FOODS A, you can compare the effects of market volatilities on CAL-MAINE FOODS and SENECA FOODS-A 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 SENECA FOODS-A. Check out your portfolio center. Please also check ongoing floating volatility patterns of CAL-MAINE FOODS and SENECA FOODS-A.
Diversification Opportunities for CAL-MAINE FOODS and SENECA FOODS-A
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CAL-MAINE and SENECA is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding CAL MAINE FOODS and SENECA FOODS A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SENECA FOODS A 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 SENECA FOODS-A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SENECA FOODS A has no effect on the direction of CAL-MAINE FOODS i.e., CAL-MAINE FOODS and SENECA FOODS-A go up and down completely randomly.
Pair Corralation between CAL-MAINE FOODS and SENECA FOODS-A
Assuming the 90 days trading horizon CAL MAINE FOODS is expected to under-perform the SENECA FOODS-A. In addition to that, CAL-MAINE FOODS is 1.94 times more volatile than SENECA FOODS A. It trades about -0.03 of its total potential returns per unit of risk. SENECA FOODS A is currently generating about 0.1 per unit of volatility. If you would invest 7,200 in SENECA FOODS A on December 29, 2024 and sell it today you would earn a total of 750.00 from holding SENECA FOODS A or generate 10.42% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
CAL MAINE FOODS vs. SENECA FOODS A
Performance |
Timeline |
CAL MAINE FOODS |
SENECA FOODS A |
CAL-MAINE FOODS and SENECA FOODS-A Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CAL-MAINE FOODS and SENECA FOODS-A
The main advantage of trading using opposite CAL-MAINE FOODS and SENECA FOODS-A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CAL-MAINE FOODS position performs unexpectedly, SENECA FOODS-A 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 SENECA FOODS-A will offset losses from the drop in SENECA FOODS-A's long position.CAL-MAINE FOODS vs. LAir Liquide SA | CAL-MAINE FOODS vs. GOLDQUEST MINING | CAL-MAINE FOODS vs. Wizz Air Holdings | CAL-MAINE FOODS vs. Jacquet Metal Service |
SENECA FOODS-A vs. Apple Inc | SENECA FOODS-A vs. Apple Inc | SENECA FOODS-A vs. Apple Inc | SENECA FOODS-A vs. Apple Inc |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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