Correlation Between SG Fleet and Pioneer Credit

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

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

Diversification Opportunities for SG Fleet and Pioneer Credit

0.0

Correlation Coefficient

SG Fleet  Pioneer Credit

Pay attention - limited upside

The 3 months correlation between SGF and Pioneer is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SG Fleet Group and Pioneer Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pioneer Credit and SG Fleet 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 SG Fleet Group are associated (or correlated) with Pioneer Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pioneer Credit has no effect on the direction of SG Fleet i.e., SG Fleet and Pioneer Credit go up and down completely randomly.

Pair Corralation between SG Fleet and Pioneer Credit

Assuming the 90 days trading horizon SG Fleet Group is expected to generate 0.24 times more return on investment than Pioneer Credit. However, SG Fleet Group is 4.1 times less risky than Pioneer Credit. It trades about 0.18 of its potential returns per unit of risk. Pioneer Credit is currently generating about -0.3 per unit of risk. If you would invest  333.00  in SG Fleet Group on October 4, 2024 and sell it today you would earn a total of  8.00  from holding SG Fleet Group or generate 2.4% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

SG Fleet Group  vs.  Pioneer Credit

SG Fleet Group

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in SG Fleet Group are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain technical and fundamental indicators, SG Fleet unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pioneer Credit

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Pioneer Credit are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain fundamental indicators, Pioneer Credit may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with SG Fleet and Pioneer Credit

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

The idea behind SG Fleet Group and Pioneer Credit 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.