Correlation Between California-Engels and Vulcan Materials

Can any of the company-specific risk be diversified away by investing in both California-Engels and Vulcan Materials 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 California-Engels and Vulcan Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between California Engels Mining and Vulcan Materials, you can compare the effects of market volatilities on California-Engels and Vulcan Materials 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 California-Engels with a short position of Vulcan Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of California-Engels and Vulcan Materials.

Diversification Opportunities for California-Engels and Vulcan Materials

0.0

Correlation Coefficient

California-Engels  Vulcan Materials

Pay attention - limited upside

The 3 months correlation between California-Engels and Vulcan is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding California Engels Mining and Vulcan Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vulcan Materials and California-Engels 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 California Engels Mining are associated (or correlated) with Vulcan Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vulcan Materials has no effect on the direction of California-Engels i.e., California-Engels and Vulcan Materials go up and down completely randomly.

Pair Corralation between California-Engels and Vulcan Materials

If you would invest  26,676  in Vulcan Materials on May 6, 2025 and sell it today you would earn a total of  818.00  from holding Vulcan Materials or generate 3.07% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

California Engels Mining  vs.  Vulcan Materials

California Engels Mining

Risk-Adjusted Performance

Very Weak

Over the last 90 days California Engels Mining has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, California-Engels is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Vulcan Materials

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Vulcan Materials are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound primary indicators, Vulcan Materials is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with California-Engels and Vulcan Materials

The main advantage of trading using opposite California-Engels and Vulcan Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if California-Engels position performs unexpectedly, Vulcan Materials 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 Vulcan Materials will offset losses from the drop in Vulcan Materials' long position.

The idea behind California Engels Mining and Vulcan Materials 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.