Correlation Between SB Technology and Xalles Holdings

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

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

Diversification Opportunities for SB Technology and Xalles Holdings

0.46

Correlation Coefficient

SB Technology  Xalles Holdings

Very weak diversification

The 3 months correlation between SFBTF and Xalles is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding SB Technology Corp and Xalles Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xalles Holdings and SB Technology 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 SB Technology Corp are associated (or correlated) with Xalles Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xalles Holdings has no effect on the direction of SB Technology i.e., SB Technology and Xalles Holdings go up and down completely randomly.

Pair Corralation between SB Technology and Xalles Holdings

If you would invest  1,845  in SB Technology Corp on August 30, 2024 and sell it today you would earn a total of  0.00  from holding SB Technology Corp or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	1.59%
Values	Daily Returns

SB Technology Corp  vs.  Xalles Holdings

SB Technology Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Xalles Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Xalles Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's essential indicators remain quite persistent which may send shares a bit higher in December 2024. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with SB Technology and Xalles Holdings

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

The idea behind SB Technology Corp and Xalles Holdings 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.