Correlation Between Sabre Insurance and Advanced Medical
Can any of the company-specific risk be diversified away by investing in both Sabre Insurance and Advanced Medical 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 Advanced Medical 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 Advanced Medical Solutions, you can compare the effects of market volatilities on Sabre Insurance and Advanced Medical 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 Advanced Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sabre Insurance and Advanced Medical.
Diversification Opportunities for Sabre Insurance and Advanced Medical
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sabre and Advanced is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Sabre Insurance Group and Advanced Medical Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advanced Medical Sol 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 Advanced Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advanced Medical Sol has no effect on the direction of Sabre Insurance i.e., Sabre Insurance and Advanced Medical go up and down completely randomly.
Pair Corralation between Sabre Insurance and Advanced Medical
Assuming the 90 days trading horizon Sabre Insurance Group is expected to under-perform the Advanced Medical. But the stock apears to be less risky and, when comparing its historical volatility, Sabre Insurance Group is 2.66 times less risky than Advanced Medical. The stock trades about -0.18 of its potential returns per unit of risk. The Advanced Medical Solutions is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 19,260 in Advanced Medical Solutions on November 7, 2024 and sell it today you would earn a total of 1,090 from holding Advanced Medical Solutions or generate 5.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sabre Insurance Group vs. Advanced Medical Solutions
Performance |
| Timeline |
| Sabre Insurance Group |
| Advanced Medical Sol |
Sabre Insurance and Advanced Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sabre Insurance and Advanced Medical
The main advantage of trading using opposite Sabre Insurance and Advanced Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sabre Insurance position performs unexpectedly, Advanced Medical 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 Advanced Medical will offset losses from the drop in Advanced Medical's long position.| Sabre Insurance vs. Cairo Communication SpA | Sabre Insurance vs. Zegona Communications Plc | Sabre Insurance vs. Gamma Communications PLC | Sabre Insurance vs. Universal Display Corp |
| Advanced Medical vs. Learning Technologies Group | Advanced Medical vs. Clean Power Hydrogen | Advanced Medical vs. Vitec Software Group | Advanced Medical vs. CleanTech Lithium 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 CEOs Directory module to screen CEOs from public companies around the world.
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