Correlation Between Chiba Bank and Sable Offshore
Can any of the company-specific risk be diversified away by investing in both Chiba Bank and Sable Offshore 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 Chiba Bank and Sable Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chiba Bank Ltd and Sable Offshore Corp, you can compare the effects of market volatilities on Chiba Bank and Sable Offshore 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 Chiba Bank with a short position of Sable Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chiba Bank and Sable Offshore.
Diversification Opportunities for Chiba Bank and Sable Offshore
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Chiba and Sable is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Chiba Bank Ltd and Sable Offshore Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sable Offshore Corp and Chiba Bank 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 Chiba Bank Ltd are associated (or correlated) with Sable Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sable Offshore Corp has no effect on the direction of Chiba Bank i.e., Chiba Bank and Sable Offshore go up and down completely randomly.
Pair Corralation between Chiba Bank and Sable Offshore
Assuming the 90 days horizon Chiba Bank is expected to generate 1.87 times less return on investment than Sable Offshore. In addition to that, Chiba Bank is 1.12 times more volatile than Sable Offshore Corp. It trades about 0.04 of its total potential returns per unit of risk. Sable Offshore Corp is currently generating about 0.07 per unit of volatility. If you would invest 1,003 in Sable Offshore Corp on September 3, 2024 and sell it today you would earn a total of 1,345 from holding Sable Offshore Corp or generate 134.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.55% |
| Values | Daily Returns |
Chiba Bank Ltd vs. Sable Offshore Corp
Performance |
| Timeline |
| Chiba Bank |
| Sable Offshore Corp |
Chiba Bank and Sable Offshore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chiba Bank and Sable Offshore
The main advantage of trading using opposite Chiba Bank and Sable Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chiba Bank position performs unexpectedly, Sable Offshore 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 Sable Offshore will offset losses from the drop in Sable Offshore's long position.| Chiba Bank vs. First Hawaiian | Chiba Bank vs. Central Pacific Financial | Chiba Bank vs. Territorial Bancorp | Chiba Bank vs. Comerica |
| Sable Offshore vs. Dine Brands Global | Sable Offshore vs. RCI Hospitality Holdings | Sable Offshore vs. Sweetgreen | Sable Offshore vs. Dennys Corp |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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