Correlation Between Sabre Corpo and Argo Group

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

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

Diversification Opportunities for Sabre Corpo and Argo Group

-0.03

Correlation Coefficient

Sabre Corpo  Argo Group

Good diversification

The 3 months correlation between Sabre and Argo is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Sabre Corpo and Argo Group International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Argo Group International and Sabre Corpo 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 Corpo are associated (or correlated) with Argo Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Argo Group International has no effect on the direction of Sabre Corpo i.e., Sabre Corpo and Argo Group go up and down completely randomly.

Pair Corralation between Sabre Corpo and Argo Group

Given the investment horizon of 90 days Sabre Corpo is expected to generate 26.25 times more return on investment than Argo Group. However, Sabre Corpo is 26.25 times more volatile than Argo Group International. It trades about 0.05 of its potential returns per unit of risk. Argo Group International is currently generating about 0.21 per unit of risk. If you would invest  391.00  in Sabre Corpo on November 28, 2024 and sell it today you would earn a total of  34.00  from holding Sabre Corpo or generate 8.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.31%
Values	Daily Returns

Sabre Corpo  vs.  Argo Group International

Sabre Corpo

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Sabre Corpo are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak fundamental drivers, Sabre Corpo reported solid returns over the last few months and may actually be approaching a breakup point.

Argo Group International

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Argo Group International are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Argo Group is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Sabre Corpo and Argo Group

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

The idea behind Sabre Corpo and Argo Group International 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.