Correlation Between Sabre Insurance and Tianjin Capital
Can any of the company-specific risk be diversified away by investing in both Sabre Insurance and Tianjin Capital 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 Sabre Insurance and Tianjin Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sabre Insurance Group and Tianjin Capital Environmental, you can compare the effects of market volatilities on Sabre Insurance and Tianjin Capital 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 Sabre Insurance with a short position of Tianjin Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sabre Insurance and Tianjin Capital.
Diversification Opportunities for Sabre Insurance and Tianjin Capital
-1.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sabre and Tianjin is -1.0. Overlapping area represents the amount of risk that can be diversified away by holding Sabre Insurance Group and Tianjin Capital Environmental in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tianjin Capital Envi and Sabre Insurance 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 Sabre Insurance Group are associated (or correlated) with Tianjin Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tianjin Capital Envi has no effect on the direction of Sabre Insurance i.e., Sabre Insurance and Tianjin Capital go up and down completely randomly.
Pair Corralation between Sabre Insurance and Tianjin Capital
Assuming the 90 days horizon Sabre Insurance Group is expected to under-perform the Tianjin Capital. In addition to that, Sabre Insurance is 2.86 times more volatile than Tianjin Capital Environmental. It trades about -0.04 of its total potential returns per unit of risk. Tianjin Capital Environmental is currently generating about 0.02 per unit of volatility. If you would invest 36.00 in Tianjin Capital Environmental on December 7, 2024 and sell it today you would earn a total of 2.00 from holding Tianjin Capital Environmental or generate 5.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sabre Insurance Group vs. Tianjin Capital Environmental
Performance |
| Timeline |
| Sabre Insurance Group |
| Tianjin Capital Envi |
Sabre Insurance and Tianjin Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sabre Insurance and Tianjin Capital
The main advantage of trading using opposite Sabre Insurance and Tianjin Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sabre Insurance position performs unexpectedly, Tianjin Capital 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 Tianjin Capital will offset losses from the drop in Tianjin Capital's long position.| Sabre Insurance vs. Douglas Emmett | Sabre Insurance vs. Old Republic International | Sabre Insurance vs. Chubb | Sabre Insurance vs. Merit Medical Systems |
| Tianjin Capital vs. Integral Ad Science | Tianjin Capital vs. Lincoln Electric Holdings | Tianjin Capital vs. KVH Industries | Tianjin Capital vs. Acumen Pharmaceuticals |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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