Correlation Between Standard Bank and Savi Financial
Can any of the company-specific risk be diversified away by investing in both Standard Bank and Savi Financial 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 Standard Bank and Savi Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Standard Bank Group and Savi Financial, you can compare the effects of market volatilities on Standard Bank and Savi Financial 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 Standard Bank with a short position of Savi Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Standard Bank and Savi Financial.
Diversification Opportunities for Standard Bank and Savi Financial
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Standard and Savi is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Standard Bank Group and Savi Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Savi Financial and Standard Bank 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 Standard Bank Group are associated (or correlated) with Savi Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Savi Financial has no effect on the direction of Standard Bank i.e., Standard Bank and Savi Financial go up and down completely randomly.
Pair Corralation between Standard Bank and Savi Financial
Assuming the 90 days horizon Standard Bank Group is expected to under-perform the Savi Financial. In addition to that, Standard Bank is 6.94 times more volatile than Savi Financial. It trades about -0.37 of its total potential returns per unit of risk. Savi Financial is currently generating about 0.1 per unit of volatility. If you would invest 1,505 in Savi Financial on October 10, 2024 and sell it today you would earn a total of 5.00 from holding Savi Financial or generate 0.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Standard Bank Group vs. Savi Financial
Performance |
| Timeline |
| Standard Bank Group |
| Savi Financial |
Standard Bank and Savi Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Standard Bank and Savi Financial
The main advantage of trading using opposite Standard Bank and Savi Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Standard Bank position performs unexpectedly, Savi Financial 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 Savi Financial will offset losses from the drop in Savi Financial's long position.| Standard Bank vs. Bank Central Asia | Standard Bank vs. Nedbank Group | Standard Bank vs. Kasikornbank Public Co | Standard Bank vs. KBC Groep NV |
| Savi Financial vs. Eurobank Ergasias Services | Savi Financial vs. Standard Bank Group | Savi Financial vs. Bank Central Asia | Savi Financial vs. PSB Holdings |
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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