Correlation Between SilverBox Corp and Old Dominion

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

By analyzing existing cross correlation between SilverBox Corp IV and Old Dominion Freight, you can compare the effects of market volatilities on SilverBox Corp and Old Dominion 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 SilverBox Corp with a short position of Old Dominion. Check out your portfolio center. Please also check ongoing floating volatility patterns of SilverBox Corp and Old Dominion.

Diversification Opportunities for SilverBox Corp and Old Dominion

-0.51

Correlation Coefficient

SilverBox Corp  Old Dominion

Excellent diversification

The 3 months correlation between SilverBox and Old is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding SilverBox Corp IV and Old Dominion Freight in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old Dominion Freight and SilverBox Corp 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 SilverBox Corp IV are associated (or correlated) with Old Dominion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old Dominion Freight has no effect on the direction of SilverBox Corp i.e., SilverBox Corp and Old Dominion go up and down completely randomly.

Pair Corralation between SilverBox Corp and Old Dominion

Given the investment horizon of 90 days SilverBox Corp IV is expected to generate 0.06 times more return on investment than Old Dominion. However, SilverBox Corp IV is 16.6 times less risky than Old Dominion. It trades about 0.12 of its potential returns per unit of risk. Old Dominion Freight is currently generating about -0.08 per unit of risk. If you would invest  1,000.00  in SilverBox Corp IV on October 15, 2024 and sell it today you would earn a total of  10.00  from holding SilverBox Corp IV or generate 1.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.39%
Values	Daily Returns

SilverBox Corp IV  vs.  Old Dominion Freight

SilverBox Corp IV

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SilverBox Corp IV are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, SilverBox Corp is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Old Dominion Freight

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Old Dominion Freight has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's technical and fundamental indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with SilverBox Corp and Old Dominion

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

The idea behind SilverBox Corp IV and Old Dominion Freight 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.