Correlation Between Sabvest Capital and FNB ETN

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

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

Diversification Opportunities for Sabvest Capital and FNB ETN

-0.44

Correlation Coefficient

Sabvest Capital  FNB ETN

Very good diversification

The 3 months correlation between Sabvest and FNB is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Sabvest Capital and FNB ETN JPMORGQ in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FNB ETN JPMORGQ and Sabvest Capital 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 Sabvest Capital are associated (or correlated) with FNB ETN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FNB ETN JPMORGQ has no effect on the direction of Sabvest Capital i.e., Sabvest Capital and FNB ETN go up and down completely randomly.

Pair Corralation between Sabvest Capital and FNB ETN

Assuming the 90 days trading horizon Sabvest Capital is expected to under-perform the FNB ETN. In addition to that, Sabvest Capital is 1.19 times more volatile than FNB ETN JPMORGQ. It trades about -0.01 of its total potential returns per unit of risk. FNB ETN JPMORGQ is currently generating about 0.13 per unit of volatility. If you would invest  259,700  in FNB ETN JPMORGQ on December 4, 2024 and sell it today you would earn a total of  20,600  from holding FNB ETN JPMORGQ or generate 7.93% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	58.33%
Values	Daily Returns

Sabvest Capital  vs.  FNB ETN JPMORGQ

Sabvest Capital

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sabvest Capital has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Sabvest Capital is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

FNB ETN JPMORGQ

Risk-Adjusted Performance

OK

Over the last 90 days FNB ETN JPMORGQ has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat weak basic indicators, FNB ETN sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sabvest Capital and FNB ETN

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

The idea behind Sabvest Capital and FNB ETN JPMORGQ 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.