Correlation Between SCANDMEDICAL SOLDK-040 and CAL-MAINE FOODS

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Can any of the company-specific risk be diversified away by investing in both SCANDMEDICAL SOLDK-040 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 SCANDMEDICAL SOLDK-040 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 SCANDMEDICAL SOLDK 040 and CAL MAINE FOODS, you can compare the effects of market volatilities on SCANDMEDICAL SOLDK-040 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 SCANDMEDICAL SOLDK-040 with a short position of CAL-MAINE FOODS. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCANDMEDICAL SOLDK-040 and CAL-MAINE FOODS.

Diversification Opportunities for SCANDMEDICAL SOLDK-040 and CAL-MAINE FOODS

-0.51
  Correlation Coefficient

Excellent diversification

The 3 months correlation between SCANDMEDICAL and CAL-MAINE is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding SCANDMEDICAL SOLDK 040 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 SCANDMEDICAL SOLDK-040 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 SCANDMEDICAL SOLDK 040 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 SCANDMEDICAL SOLDK-040 i.e., SCANDMEDICAL SOLDK-040 and CAL-MAINE FOODS go up and down completely randomly.

Pair Corralation between SCANDMEDICAL SOLDK-040 and CAL-MAINE FOODS

Assuming the 90 days horizon SCANDMEDICAL SOLDK 040 is expected to generate 3.9 times more return on investment than CAL-MAINE FOODS. However, SCANDMEDICAL SOLDK-040 is 3.9 times more volatile than CAL MAINE FOODS. It trades about 0.03 of its potential returns per unit of risk. CAL MAINE FOODS is currently generating about 0.09 per unit of risk. If you would invest  96.00  in SCANDMEDICAL SOLDK 040 on October 12, 2024 and sell it today you would lose (23.00) from holding SCANDMEDICAL SOLDK 040 or give up 23.96% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy99.8%
ValuesDaily Returns

SCANDMEDICAL SOLDK 040  vs.  CAL MAINE FOODS

 Performance 
       Timeline  
SCANDMEDICAL SOLDK 040 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days SCANDMEDICAL SOLDK 040 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, SCANDMEDICAL SOLDK-040 is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.
CAL MAINE FOODS 

Risk-Adjusted Performance

15 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in CAL MAINE FOODS are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, CAL-MAINE FOODS exhibited solid returns over the last few months and may actually be approaching a breakup point.

SCANDMEDICAL SOLDK-040 and CAL-MAINE FOODS Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with SCANDMEDICAL SOLDK-040 and CAL-MAINE FOODS

The main advantage of trading using opposite SCANDMEDICAL SOLDK-040 and CAL-MAINE FOODS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCANDMEDICAL SOLDK-040 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's long position.
The idea behind SCANDMEDICAL SOLDK 040 and CAL MAINE FOODS pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.

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