Correlation Between GRIFFIN MINING and Cal Maine

Can any of the company-specific risk be diversified away by investing in both GRIFFIN MINING 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 GRIFFIN MINING and Cal Maine into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GRIFFIN MINING LTD and Cal Maine Foods, you can compare the effects of market volatilities on GRIFFIN MINING 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 GRIFFIN MINING with a short position of Cal Maine. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRIFFIN MINING and Cal Maine.

Diversification Opportunities for GRIFFIN MINING and Cal Maine

-0.49

Correlation Coefficient

GRIFFIN MINING  Cal Maine

Very good diversification

The 3 months correlation between GRIFFIN and Cal is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding GRIFFIN MINING LTD 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 GRIFFIN MINING 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 GRIFFIN MINING LTD 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 GRIFFIN MINING i.e., GRIFFIN MINING and Cal Maine go up and down completely randomly.

Pair Corralation between GRIFFIN MINING and Cal Maine

Assuming the 90 days horizon GRIFFIN MINING is expected to generate 24.37 times less return on investment than Cal Maine. But when comparing it to its historical volatility, GRIFFIN MINING LTD is 1.23 times less risky than Cal Maine. It trades about 0.01 of its potential returns per unit of risk. Cal Maine Foods is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest  6,472  in Cal Maine Foods on September 25, 2024 and sell it today you would earn a total of  3,352  from holding Cal Maine Foods or generate 51.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

GRIFFIN MINING LTD  vs.  Cal Maine Foods

GRIFFIN MINING LTD

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in GRIFFIN MINING LTD are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, GRIFFIN MINING is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Cal Maine Foods

Risk-Adjusted Performance

22 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Cal Maine Foods are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Cal Maine unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GRIFFIN MINING and Cal Maine

The main advantage of trading using opposite GRIFFIN MINING and Cal Maine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GRIFFIN MINING 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.

The idea behind GRIFFIN MINING LTD 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.