Correlation Between ArcBest and Saia
Can any of the company-specific risk be diversified away by investing in both ArcBest and Saia 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 ArcBest and Saia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ArcBest and Saia Inc, you can compare the effects of market volatilities on ArcBest and Saia 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 ArcBest with a short position of Saia. Check out your portfolio center. Please also check ongoing floating volatility patterns of ArcBest and Saia.
Diversification Opportunities for ArcBest and Saia
Very poor diversification
The 3 months correlation between ArcBest and Saia is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding ArcBest and Saia Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saia Inc and ArcBest 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 ArcBest are associated (or correlated) with Saia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saia Inc has no effect on the direction of ArcBest i.e., ArcBest and Saia go up and down completely randomly.
Pair Corralation between ArcBest and Saia
Assuming the 90 days horizon ArcBest is expected to generate 1.11 times less return on investment than Saia. In addition to that, ArcBest is 1.12 times more volatile than Saia Inc. It trades about 0.21 of its total potential returns per unit of risk. Saia Inc is currently generating about 0.27 per unit of volatility. If you would invest 44,000 in Saia Inc on September 4, 2024 and sell it today you would earn a total of 9,500 from holding Saia Inc or generate 21.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ArcBest vs. Saia Inc
Performance |
| Timeline |
| ArcBest |
| Saia Inc |
ArcBest and Saia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ArcBest and Saia
The main advantage of trading using opposite ArcBest and Saia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ArcBest position performs unexpectedly, Saia 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 Saia will offset losses from the drop in Saia's long position.| ArcBest vs. Old Dominion Freight | ArcBest vs. Saia Inc | ArcBest vs. SCHNEIDER NATLINC CLB | ArcBest vs. Seino Holdings Co |
| Saia vs. Old Dominion Freight | Saia vs. SCHNEIDER NATLINC CLB | Saia vs. Seino Holdings Co | Saia vs. Fukuyama Transporting Co |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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