Correlation Between FG Annuities and Sanlam
Can any of the company-specific risk be diversified away by investing in both FG Annuities and Sanlam 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 FG Annuities and Sanlam into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FG Annuities Life and Sanlam Ltd PK, you can compare the effects of market volatilities on FG Annuities and Sanlam 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 FG Annuities with a short position of Sanlam. Check out your portfolio center. Please also check ongoing floating volatility patterns of FG Annuities and Sanlam.
Diversification Opportunities for FG Annuities and Sanlam
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between FG Annuities and Sanlam is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding FG Annuities Life and Sanlam Ltd PK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sanlam Ltd PK and FG Annuities 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 FG Annuities Life are associated (or correlated) with Sanlam. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sanlam Ltd PK has no effect on the direction of FG Annuities i.e., FG Annuities and Sanlam go up and down completely randomly.
Pair Corralation between FG Annuities and Sanlam
Allowing for the 90-day total investment horizon FG Annuities Life is expected to generate 2.64 times more return on investment than Sanlam. However, FG Annuities is 2.64 times more volatile than Sanlam Ltd PK. It trades about 0.19 of its potential returns per unit of risk. Sanlam Ltd PK is currently generating about -0.09 per unit of risk. If you would invest 4,166 in FG Annuities Life on August 28, 2024 and sell it today you would earn a total of 677.00 from holding FG Annuities Life or generate 16.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FG Annuities Life vs. Sanlam Ltd PK
Performance |
| Timeline |
| FG Annuities Life |
| Sanlam Ltd PK |
FG Annuities and Sanlam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FG Annuities and Sanlam
The main advantage of trading using opposite FG Annuities and Sanlam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FG Annuities position performs unexpectedly, Sanlam 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 Sanlam will offset losses from the drop in Sanlam's long position.| FG Annuities vs. Morningstar Unconstrained Allocation | FG Annuities vs. Via Renewables | FG Annuities vs. Sitka Gold Corp | FG Annuities vs. MSCI ACWI exAUCONSUMER |
| Sanlam vs. Ping An Insurance | Sanlam vs. CNO Financial Group | Sanlam vs. Genworth Financial | Sanlam vs. MetLife Preferred Stock |
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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