Correlation Between Seeing Machines and Sabien Technology
Can any of the company-specific risk be diversified away by investing in both Seeing Machines and Sabien Technology 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 Seeing Machines and Sabien Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seeing Machines Limited and Sabien Technology Group, you can compare the effects of market volatilities on Seeing Machines and Sabien Technology 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 Seeing Machines with a short position of Sabien Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seeing Machines and Sabien Technology.
Diversification Opportunities for Seeing Machines and Sabien Technology
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Seeing and Sabien is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Seeing Machines Limited and Sabien Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sabien Technology and Seeing Machines 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 Seeing Machines Limited are associated (or correlated) with Sabien Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sabien Technology has no effect on the direction of Seeing Machines i.e., Seeing Machines and Sabien Technology go up and down completely randomly.
Pair Corralation between Seeing Machines and Sabien Technology
Assuming the 90 days trading horizon Seeing Machines Limited is expected to generate 3.73 times more return on investment than Sabien Technology. However, Seeing Machines is 3.73 times more volatile than Sabien Technology Group. It trades about 0.08 of its potential returns per unit of risk. Sabien Technology Group is currently generating about -0.34 per unit of risk. If you would invest 451.00 in Seeing Machines Limited on August 26, 2024 and sell it today you would earn a total of 41.00 from holding Seeing Machines Limited or generate 9.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Seeing Machines Limited vs. Sabien Technology Group
Performance |
| Timeline |
| Seeing Machines |
| Sabien Technology |
Seeing Machines and Sabien Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seeing Machines and Sabien Technology
The main advantage of trading using opposite Seeing Machines and Sabien Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seeing Machines position performs unexpectedly, Sabien Technology 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 Sabien Technology will offset losses from the drop in Sabien Technology's long position.| Seeing Machines vs. Sabien Technology Group | Seeing Machines vs. HCA Healthcare | Seeing Machines vs. Alfa Financial Software | Seeing Machines vs. Cardinal Health |
| Sabien Technology vs. Catalyst Media Group | Sabien Technology vs. CATLIN GROUP | Sabien Technology vs. Tamburi Investment Partners | Sabien Technology vs. Magnora 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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