Correlation Between Universal Display and Sabre Insurance
Can any of the company-specific risk be diversified away by investing in both Universal Display 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 Universal Display and Sabre Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Universal Display Corp and Sabre Insurance Group, you can compare the effects of market volatilities on Universal Display 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 Universal Display with a short position of Sabre Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Universal Display and Sabre Insurance.
Diversification Opportunities for Universal Display and Sabre Insurance
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Universal and Sabre is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Universal Display 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 Universal Display 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 Universal Display 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 Universal Display i.e., Universal Display and Sabre Insurance go up and down completely randomly.
Pair Corralation between Universal Display and Sabre Insurance
Assuming the 90 days trading horizon Universal Display Corp is expected to generate 1.58 times more return on investment than Sabre Insurance. However, Universal Display is 1.58 times more volatile than Sabre Insurance Group. It trades about 0.05 of its potential returns per unit of risk. Sabre Insurance Group is currently generating about 0.04 per unit of risk. If you would invest 10,515 in Universal Display Corp on September 3, 2024 and sell it today you would earn a total of 5,896 from holding Universal Display Corp or generate 56.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 82.13% |
| Values | Daily Returns |
Universal Display Corp vs. Sabre Insurance Group
Performance |
| Timeline |
| Universal Display Corp |
| Sabre Insurance Group |
Universal Display and Sabre Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Universal Display and Sabre Insurance
The main advantage of trading using opposite Universal Display and Sabre Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Universal Display 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.| Universal Display vs. MoneysupermarketCom Group PLC | Universal Display vs. Impax Asset Management | Universal Display vs. Jupiter Fund Management | Universal Display vs. Orient Telecoms |
| Sabre Insurance vs. McEwen Mining | Sabre Insurance vs. United Internet AG | Sabre Insurance vs. Universal Display Corp | Sabre Insurance vs. GoldMining |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. |