Correlation Between Sable Offshore and Chiba Bank
Can any of the company-specific risk be diversified away by investing in both Sable Offshore and Chiba Bank 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 Sable Offshore and Chiba Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sable Offshore Corp and Chiba Bank Ltd, you can compare the effects of market volatilities on Sable Offshore and Chiba Bank 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 Sable Offshore with a short position of Chiba Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sable Offshore and Chiba Bank.
Diversification Opportunities for Sable Offshore and Chiba Bank
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Sable and Chiba is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Sable Offshore Corp and Chiba Bank Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chiba Bank and Sable Offshore 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 Sable Offshore Corp are associated (or correlated) with Chiba Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chiba Bank has no effect on the direction of Sable Offshore i.e., Sable Offshore and Chiba Bank go up and down completely randomly.
Pair Corralation between Sable Offshore and Chiba Bank
Considering the 90-day investment horizon Sable Offshore Corp is expected to generate 0.89 times more return on investment than Chiba Bank. However, Sable Offshore Corp is 1.12 times less risky than Chiba Bank. It trades about 0.07 of its potential returns per unit of risk. Chiba Bank Ltd is currently generating about 0.04 per unit of risk. If you would invest 1,003 in Sable Offshore Corp on September 3, 2024 and sell it today you would earn a total of 1,345 from holding Sable Offshore Corp or generate 134.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.55% |
| Values | Daily Returns |
Sable Offshore Corp vs. Chiba Bank Ltd
Performance |
| Timeline |
| Sable Offshore Corp |
| Chiba Bank |
Sable Offshore and Chiba Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sable Offshore and Chiba Bank
The main advantage of trading using opposite Sable Offshore and Chiba Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sable Offshore position performs unexpectedly, Chiba Bank 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 Chiba Bank will offset losses from the drop in Chiba Bank's long position.| Sable Offshore vs. Dine Brands Global | Sable Offshore vs. RCI Hospitality Holdings | Sable Offshore vs. Sweetgreen | Sable Offshore vs. Dennys Corp |
| Chiba Bank vs. First Hawaiian | Chiba Bank vs. Central Pacific Financial | Chiba Bank vs. Territorial Bancorp | Chiba Bank vs. Comerica |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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