Correlation Between Sabre Insurance and CRAWFORD A

Can any of the company-specific risk be diversified away by investing in both Sabre Insurance and CRAWFORD A 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 CRAWFORD A 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 CRAWFORD A NV, you can compare the effects of market volatilities on Sabre Insurance and CRAWFORD A 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 CRAWFORD A. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sabre Insurance and CRAWFORD A.

Diversification Opportunities for Sabre Insurance and CRAWFORD A

-0.71

Correlation Coefficient

Sabre Insurance  CRAWFORD A

Pay attention - limited upside

The 3 months correlation between Sabre and CRAWFORD is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Sabre Insurance Group and CRAWFORD A NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CRAWFORD A NV 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 CRAWFORD A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CRAWFORD A NV has no effect on the direction of Sabre Insurance i.e., Sabre Insurance and CRAWFORD A go up and down completely randomly.

Pair Corralation between Sabre Insurance and CRAWFORD A

Assuming the 90 days horizon Sabre Insurance is expected to generate 1.64 times less return on investment than CRAWFORD A. But when comparing it to its historical volatility, Sabre Insurance Group is 1.39 times less risky than CRAWFORD A. It trades about 0.02 of its potential returns per unit of risk. CRAWFORD A NV is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  980.00  in CRAWFORD A NV on September 27, 2024 and sell it today you would earn a total of  80.00  from holding CRAWFORD A NV or generate 8.16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Sabre Insurance Group  vs.  CRAWFORD A NV

Sabre Insurance Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sabre Insurance Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Sabre Insurance is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

CRAWFORD A NV

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CRAWFORD A NV are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile forward-looking signals, CRAWFORD A reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sabre Insurance and CRAWFORD A

The main advantage of trading using opposite Sabre Insurance and CRAWFORD A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sabre Insurance position performs unexpectedly, CRAWFORD A 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 CRAWFORD A will offset losses from the drop in CRAWFORD A's long position.

The idea behind Sabre Insurance Group and CRAWFORD A NV pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.