Correlation Between Maximus and Sabre Corpo

Can any of the company-specific risk be diversified away by investing in both Maximus and Sabre Corpo 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 Maximus and Sabre Corpo into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Maximus and Sabre Corpo, you can compare the effects of market volatilities on Maximus and Sabre Corpo 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 Maximus with a short position of Sabre Corpo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maximus and Sabre Corpo.

Diversification Opportunities for Maximus and Sabre Corpo

-0.33

Correlation Coefficient

Maximus  Sabre Corpo

Very good diversification

The 3 months correlation between Maximus and Sabre is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Maximus and Sabre Corpo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sabre Corpo and Maximus 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 Maximus are associated (or correlated) with Sabre Corpo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sabre Corpo has no effect on the direction of Maximus i.e., Maximus and Sabre Corpo go up and down completely randomly.

Pair Corralation between Maximus and Sabre Corpo

Considering the 90-day investment horizon Maximus is expected to under-perform the Sabre Corpo. But the stock apears to be less risky and, when comparing its historical volatility, Maximus is 2.18 times less risky than Sabre Corpo. The stock trades about -0.08 of its potential returns per unit of risk. The Sabre Corpo is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  367.00  in Sabre Corpo on October 22, 2024 and sell it today you would lose (33.00) from holding Sabre Corpo or give up 8.99% of portfolio value over 90 days.

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

Maximus  vs.  Sabre Corpo

Maximus

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Maximus has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's primary indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Sabre Corpo

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sabre Corpo has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable fundamental drivers, Sabre Corpo is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Maximus and Sabre Corpo

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

The idea behind Maximus and Sabre Corpo 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 CEOs Directory module to screen CEOs from public companies around the world.