Correlation Between SAB Finance and Vienna Insurance
Can any of the company-specific risk be diversified away by investing in both SAB Finance and Vienna 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 SAB Finance and Vienna Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SAB Finance as and Vienna Insurance Group, you can compare the effects of market volatilities on SAB Finance and Vienna 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 SAB Finance with a short position of Vienna Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of SAB Finance and Vienna Insurance.
Diversification Opportunities for SAB Finance and Vienna Insurance
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SAB and Vienna is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding SAB Finance as and Vienna Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vienna Insurance and SAB Finance 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 SAB Finance as are associated (or correlated) with Vienna Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vienna Insurance has no effect on the direction of SAB Finance i.e., SAB Finance and Vienna Insurance go up and down completely randomly.
Pair Corralation between SAB Finance and Vienna Insurance
Assuming the 90 days trading horizon SAB Finance as is expected to generate 0.85 times more return on investment than Vienna Insurance. However, SAB Finance as is 1.18 times less risky than Vienna Insurance. It trades about -0.04 of its potential returns per unit of risk. Vienna Insurance Group is currently generating about -0.14 per unit of risk. If you would invest 107,000 in SAB Finance as on August 31, 2024 and sell it today you would lose (2,000) from holding SAB Finance as or give up 1.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SAB Finance as vs. Vienna Insurance Group
Performance |
| Timeline |
| SAB Finance as |
| Vienna Insurance |
SAB Finance and Vienna Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SAB Finance and Vienna Insurance
The main advantage of trading using opposite SAB Finance and Vienna Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SAB Finance position performs unexpectedly, Vienna 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 Vienna Insurance will offset losses from the drop in Vienna Insurance's long position.| SAB Finance vs. Raiffeisen Bank International | SAB Finance vs. Vienna Insurance Group | SAB Finance vs. Komercni Banka AS | SAB Finance vs. UNIQA Insurance Group |
| Vienna Insurance vs. JT ARCH INVESTMENTS | Vienna Insurance vs. Erste Group Bank | Vienna Insurance vs. Raiffeisen Bank International | Vienna Insurance vs. Komercni Banka AS |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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