Correlation Between Sabre Insurance and Vienna Insurance
Can any of the company-specific risk be diversified away by investing in both Sabre Insurance 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 Sabre Insurance and Vienna Insurance 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 Vienna Insurance Group, you can compare the effects of market volatilities on Sabre Insurance 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 Sabre Insurance with a short position of Vienna Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sabre Insurance and Vienna Insurance.
Diversification Opportunities for Sabre Insurance and Vienna Insurance
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sabre and Vienna is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Sabre Insurance Group and Vienna Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vienna Insurance 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 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 Sabre Insurance i.e., Sabre Insurance and Vienna Insurance go up and down completely randomly.
Pair Corralation between Sabre Insurance and Vienna Insurance
Assuming the 90 days trading horizon Sabre Insurance is expected to generate 4.39 times less return on investment than Vienna Insurance. In addition to that, Sabre Insurance is 1.78 times more volatile than Vienna Insurance Group. It trades about 0.01 of its total potential returns per unit of risk. Vienna Insurance Group is currently generating about 0.07 per unit of volatility. If you would invest 2,318 in Vienna Insurance Group on September 2, 2024 and sell it today you would earn a total of 605.00 from holding Vienna Insurance Group or generate 26.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sabre Insurance Group vs. Vienna Insurance Group
Performance |
| Timeline |
| Sabre Insurance Group |
| Vienna Insurance |
Sabre Insurance and Vienna Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sabre Insurance and Vienna Insurance
The main advantage of trading using opposite Sabre Insurance and Vienna Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sabre Insurance 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.| Sabre Insurance vs. Berkshire Hathaway | Sabre Insurance vs. Hyundai Motor | Sabre Insurance vs. Samsung Electronics Co | Sabre Insurance vs. Samsung Electronics Co |
| Vienna Insurance vs. Uniper SE | Vienna Insurance vs. Mulberry Group PLC | Vienna Insurance vs. London Security Plc | Vienna Insurance vs. Triad Group PLC |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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