Correlation Between Saba Capital and Vulcan Value
Can any of the company-specific risk be diversified away by investing in both Saba Capital and Vulcan Value 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 Saba Capital and Vulcan Value into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saba Capital Income and Vulcan Value Partners, you can compare the effects of market volatilities on Saba Capital and Vulcan Value 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 Saba Capital with a short position of Vulcan Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saba Capital and Vulcan Value.
Diversification Opportunities for Saba Capital and Vulcan Value
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Saba and Vulcan is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Saba Capital Income and Vulcan Value Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vulcan Value Partners and Saba Capital 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 Saba Capital Income are associated (or correlated) with Vulcan Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vulcan Value Partners has no effect on the direction of Saba Capital i.e., Saba Capital and Vulcan Value go up and down completely randomly.
Pair Corralation between Saba Capital and Vulcan Value
Considering the 90-day investment horizon Saba Capital Income is expected to generate 0.54 times more return on investment than Vulcan Value. However, Saba Capital Income is 1.87 times less risky than Vulcan Value. It trades about 0.54 of its potential returns per unit of risk. Vulcan Value Partners is currently generating about -0.14 per unit of risk. If you would invest 745.00 in Saba Capital Income on September 12, 2024 and sell it today you would earn a total of 42.00 from holding Saba Capital Income or generate 5.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Saba Capital Income vs. Vulcan Value Partners
Performance |
| Timeline |
| Saba Capital Income |
| Vulcan Value Partners |
Saba Capital and Vulcan Value Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saba Capital and Vulcan Value
The main advantage of trading using opposite Saba Capital and Vulcan Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saba Capital position performs unexpectedly, Vulcan Value 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 Value will offset losses from the drop in Vulcan Value's long position.| Saba Capital vs. Federated Premier Municipal | Saba Capital vs. Blackrock Muniyield | Saba Capital vs. Diamond Hill Investment | Saba Capital vs. NXG NextGen Infrastructure |
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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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