Correlation Between Sabre Insurance and Wheaton Precious
Can any of the company-specific risk be diversified away by investing in both Sabre Insurance and Wheaton Precious 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 Wheaton Precious 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 Wheaton Precious Metals, you can compare the effects of market volatilities on Sabre Insurance and Wheaton Precious 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 Wheaton Precious. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sabre Insurance and Wheaton Precious.
Diversification Opportunities for Sabre Insurance and Wheaton Precious
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sabre and Wheaton is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Sabre Insurance Group and Wheaton Precious Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wheaton Precious Metals 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 Wheaton Precious. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wheaton Precious Metals has no effect on the direction of Sabre Insurance i.e., Sabre Insurance and Wheaton Precious go up and down completely randomly.
Pair Corralation between Sabre Insurance and Wheaton Precious
Assuming the 90 days trading horizon Sabre Insurance Group is expected to under-perform the Wheaton Precious. But the stock apears to be less risky and, when comparing its historical volatility, Sabre Insurance Group is 1.05 times less risky than Wheaton Precious. The stock trades about -0.18 of its potential returns per unit of risk. The Wheaton Precious Metals is currently generating about 0.4 of returns per unit of risk over similar time horizon. If you would invest 455,500 in Wheaton Precious Metals on November 7, 2024 and sell it today you would earn a total of 59,500 from holding Wheaton Precious Metals or generate 13.06% 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. Wheaton Precious Metals
Performance |
| Timeline |
| Sabre Insurance Group |
| Wheaton Precious Metals |
Sabre Insurance and Wheaton Precious Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sabre Insurance and Wheaton Precious
The main advantage of trading using opposite Sabre Insurance and Wheaton Precious positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sabre Insurance position performs unexpectedly, Wheaton Precious 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 Wheaton Precious will offset losses from the drop in Wheaton Precious' 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 |
| Wheaton Precious vs. Liberty Media Corp | Wheaton Precious vs. Solstad Offshore ASA | Wheaton Precious vs. Centaur Media | Wheaton Precious vs. BW Offshore |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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