Correlation Between Sanmina and Zebra Technologies
Can any of the company-specific risk be diversified away by investing in both Sanmina and Zebra Technologies 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 Sanmina and Zebra Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sanmina and Zebra Technologies, you can compare the effects of market volatilities on Sanmina and Zebra Technologies 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 Sanmina with a short position of Zebra Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sanmina and Zebra Technologies.
Diversification Opportunities for Sanmina and Zebra Technologies
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sanmina and Zebra is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Sanmina and Zebra Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zebra Technologies and Sanmina 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 Sanmina are associated (or correlated) with Zebra Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zebra Technologies has no effect on the direction of Sanmina i.e., Sanmina and Zebra Technologies go up and down completely randomly.
Pair Corralation between Sanmina and Zebra Technologies
Given the investment horizon of 90 days Sanmina is expected to generate 2.41 times more return on investment than Zebra Technologies. However, Sanmina is 2.41 times more volatile than Zebra Technologies. It trades about 0.15 of its potential returns per unit of risk. Zebra Technologies is currently generating about 0.2 per unit of risk. If you would invest 7,180 in Sanmina on August 31, 2024 and sell it today you would earn a total of 687.00 from holding Sanmina or generate 9.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sanmina vs. Zebra Technologies
Performance |
| Timeline |
| Sanmina |
| Zebra Technologies |
Sanmina and Zebra Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sanmina and Zebra Technologies
The main advantage of trading using opposite Sanmina and Zebra Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sanmina position performs unexpectedly, Zebra Technologies 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 Zebra Technologies will offset losses from the drop in Zebra Technologies' long position.| Sanmina vs. Benchmark Electronics | Sanmina vs. Methode Electronics | Sanmina vs. OSI Systems | Sanmina vs. Celestica |
| Zebra Technologies vs. Credo Technology Group | Zebra Technologies vs. Ubiquiti Networks | Zebra Technologies vs. Ciena Corp | Zebra Technologies vs. Clearfield |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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