Correlation Between Sabra Health and Carlsberg
Can any of the company-specific risk be diversified away by investing in both Sabra Health and Carlsberg 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 Sabra Health and Carlsberg into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sabra Health Care and Carlsberg AS, you can compare the effects of market volatilities on Sabra Health and Carlsberg 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 Sabra Health with a short position of Carlsberg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sabra Health and Carlsberg.
Diversification Opportunities for Sabra Health and Carlsberg
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sabra and Carlsberg is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Sabra Health Care and Carlsberg AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carlsberg AS and Sabra Health 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 Sabra Health Care are associated (or correlated) with Carlsberg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carlsberg AS has no effect on the direction of Sabra Health i.e., Sabra Health and Carlsberg go up and down completely randomly.
Pair Corralation between Sabra Health and Carlsberg
Assuming the 90 days horizon Sabra Health Care is expected to generate 0.87 times more return on investment than Carlsberg. However, Sabra Health Care is 1.15 times less risky than Carlsberg. It trades about 0.07 of its potential returns per unit of risk. Carlsberg AS is currently generating about 0.03 per unit of risk. If you would invest 962.00 in Sabra Health Care on September 14, 2024 and sell it today you would earn a total of 718.00 from holding Sabra Health Care or generate 74.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sabra Health Care vs. Carlsberg AS
Performance |
| Timeline |
| Sabra Health Care |
| Carlsberg AS |
Sabra Health and Carlsberg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sabra Health and Carlsberg
The main advantage of trading using opposite Sabra Health and Carlsberg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sabra Health position performs unexpectedly, Carlsberg 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 Carlsberg will offset losses from the drop in Carlsberg's long position.| Sabra Health vs. The Yokohama Rubber | Sabra Health vs. IMPERIAL TOBACCO | Sabra Health vs. VULCAN MATERIALS | Sabra Health vs. JAPAN TOBACCO UNSPADR12 |
| Carlsberg vs. Superior Plus Corp | Carlsberg vs. SIVERS SEMICONDUCTORS AB | Carlsberg vs. NorAm Drilling AS | Carlsberg vs. Norsk Hydro ASA |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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