Correlation Between CAL MAINE and Fresenius Medical

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

Diversification Opportunities for CAL MAINE and Fresenius Medical

0.3

Correlation Coefficient

CAL MAINE  Fresenius Medical

Weak diversification

The 3 months correlation between CAL and Fresenius is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding CAL MAINE FOODS and Fresenius Medical Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fresenius Medical Care and CAL MAINE 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 Fresenius Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fresenius Medical Care has no effect on the direction of CAL MAINE i.e., CAL MAINE and Fresenius Medical go up and down completely randomly.

Pair Corralation between CAL MAINE and Fresenius Medical

Assuming the 90 days trading horizon CAL MAINE FOODS is expected to generate 1.16 times more return on investment than Fresenius Medical. However, CAL MAINE is 1.16 times more volatile than Fresenius Medical Care. It trades about 0.14 of its potential returns per unit of risk. Fresenius Medical Care is currently generating about 0.11 per unit of risk. If you would invest  7,829  in CAL MAINE FOODS on April 24, 2025 and sell it today you would earn a total of  1,189  from holding CAL MAINE FOODS or generate 15.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

CAL MAINE FOODS  vs.  Fresenius Medical Care

CAL MAINE FOODS

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CAL MAINE FOODS are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, CAL MAINE exhibited solid returns over the last few months and may actually be approaching a breakup point.

Fresenius Medical Care

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fresenius Medical Care are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady technical and fundamental indicators, Fresenius Medical may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with CAL MAINE and Fresenius Medical

The main advantage of trading using opposite CAL MAINE and Fresenius Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CAL MAINE position performs unexpectedly, Fresenius Medical 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 Fresenius Medical will offset losses from the drop in Fresenius Medical's long position.

The idea behind CAL MAINE FOODS and Fresenius Medical Care 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.