Correlation Between Mulberry Group and Sabre Insurance
Can any of the company-specific risk be diversified away by investing in both Mulberry Group 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 Mulberry Group and Sabre Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mulberry Group PLC and Sabre Insurance Group, you can compare the effects of market volatilities on Mulberry Group 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 Mulberry Group with a short position of Sabre Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mulberry Group and Sabre Insurance.
Diversification Opportunities for Mulberry Group and Sabre Insurance
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Mulberry and Sabre is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Mulberry Group PLC 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 Mulberry Group 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 Mulberry Group PLC 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 Mulberry Group i.e., Mulberry Group and Sabre Insurance go up and down completely randomly.
Pair Corralation between Mulberry Group and Sabre Insurance
Assuming the 90 days trading horizon Mulberry Group PLC is expected to under-perform the Sabre Insurance. In addition to that, Mulberry Group is 2.93 times more volatile than Sabre Insurance Group. It trades about -0.11 of its total potential returns per unit of risk. Sabre Insurance Group is currently generating about -0.16 per unit of volatility. If you would invest 13,740 in Sabre Insurance Group on September 4, 2024 and sell it today you would lose (680.00) from holding Sabre Insurance Group or give up 4.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Mulberry Group PLC vs. Sabre Insurance Group
Performance |
| Timeline |
| Mulberry Group PLC |
| Sabre Insurance Group |
Mulberry Group and Sabre Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mulberry Group and Sabre Insurance
The main advantage of trading using opposite Mulberry Group and Sabre Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mulberry Group 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.| Mulberry Group vs. Intermediate Capital Group | Mulberry Group vs. MediaZest plc | Mulberry Group vs. Catena Media PLC | Mulberry Group vs. Everyman Media Group |
| Sabre Insurance vs. Quadrise Plc | Sabre Insurance vs. ImmuPharma PLC | Sabre Insurance vs. Intuitive Investments Group | Sabre Insurance vs. European Metals Holdings |
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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