Correlation Between National Beverage and Sabre Insurance
Can any of the company-specific risk be diversified away by investing in both National Beverage and Sabre Insurance 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 National Beverage and Sabre Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Beverage Corp and Sabre Insurance Group, you can compare the effects of market volatilities on National Beverage and Sabre Insurance 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 National Beverage with a short position of Sabre Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Beverage and Sabre Insurance.
Diversification Opportunities for National Beverage and Sabre Insurance
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between National and Sabre is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding National Beverage Corp and Sabre Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sabre Insurance Group and National Beverage 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 National Beverage Corp are associated (or correlated) with Sabre Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sabre Insurance Group has no effect on the direction of National Beverage i.e., National Beverage and Sabre Insurance go up and down completely randomly.
Pair Corralation between National Beverage and Sabre Insurance
Assuming the 90 days trading horizon National Beverage Corp is expected to generate 0.82 times more return on investment than Sabre Insurance. However, National Beverage Corp is 1.23 times less risky than Sabre Insurance. It trades about 0.16 of its potential returns per unit of risk. Sabre Insurance Group is currently generating about -0.05 per unit of risk. If you would invest 4,532 in National Beverage Corp on August 24, 2024 and sell it today you would earn a total of 268.00 from holding National Beverage Corp or generate 5.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Beverage Corp vs. Sabre Insurance Group
Performance |
| Timeline |
| National Beverage Corp |
| Sabre Insurance Group |
National Beverage and Sabre Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Beverage and Sabre Insurance
The main advantage of trading using opposite National Beverage and Sabre Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Beverage position performs unexpectedly, Sabre Insurance 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 Sabre Insurance will offset losses from the drop in Sabre Insurance's long position.| National Beverage vs. Endeavour Mining Corp | National Beverage vs. Futura Medical | National Beverage vs. Coeur Mining | National Beverage vs. Blackrock World Mining |
| Sabre Insurance vs. Verizon Communications | Sabre Insurance vs. Zegona Communications Plc | Sabre Insurance vs. National Beverage Corp | Sabre Insurance vs. Gamma Communications PLC |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |