Correlation Between Trip Group and Sabre
Can any of the company-specific risk be diversified away by investing in both Trip Group and Sabre 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 Trip Group and Sabre into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trip Group Ltd and Sabre, you can compare the effects of market volatilities on Trip Group and Sabre 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 Trip Group with a short position of Sabre. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trip Group and Sabre.
Diversification Opportunities for Trip Group and Sabre
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Trip and Sabre is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Trip Group Ltd and Sabre in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sabre and Trip Group 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 Trip Group Ltd are associated (or correlated) with Sabre. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sabre has no effect on the direction of Trip Group i.e., Trip Group and Sabre go up and down completely randomly.
Pair Corralation between Trip Group and Sabre
If you would invest 5,643 in Sabre on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Sabre or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Trip Group Ltd vs. Sabre
Performance |
| Timeline |
| Trip Group |
| Sabre |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Trip Group and Sabre Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Trip Group and Sabre
The main advantage of trading using opposite Trip Group and Sabre positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trip Group position performs unexpectedly, Sabre 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 Sabre will offset losses from the drop in Sabre's long position.| Trip Group vs. Expedia Group | Trip Group vs. Booking Holdings | Trip Group vs. Despegar Corp | Trip Group vs. Travel Leisure Co |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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