Correlation Between SupplyMe Capital and Sabien Technology

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

By analyzing existing cross correlation between SupplyMe Capital PLC and Sabien Technology Group, you can compare the effects of market volatilities on SupplyMe Capital and Sabien Technology 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 SupplyMe Capital with a short position of Sabien Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of SupplyMe Capital and Sabien Technology.

Diversification Opportunities for SupplyMe Capital and Sabien Technology

0.5

Correlation Coefficient

SupplyMe Capital  Sabien Technology

Very weak diversification

The 3 months correlation between SupplyMe and Sabien is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding SupplyMe Capital PLC and Sabien Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sabien Technology and SupplyMe 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 SupplyMe Capital PLC are associated (or correlated) with Sabien Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sabien Technology has no effect on the direction of SupplyMe Capital i.e., SupplyMe Capital and Sabien Technology go up and down completely randomly.

Pair Corralation between SupplyMe Capital and Sabien Technology

Assuming the 90 days trading horizon SupplyMe Capital PLC is expected to under-perform the Sabien Technology. In addition to that, SupplyMe Capital is 2.44 times more volatile than Sabien Technology Group. It trades about -0.05 of its total potential returns per unit of risk. Sabien Technology Group is currently generating about 0.16 per unit of volatility. If you would invest  1,100  in Sabien Technology Group on October 10, 2024 and sell it today you would earn a total of  175.00  from holding Sabien Technology Group or generate 15.91% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.0%
Values	Daily Returns

SupplyMe Capital PLC  vs.  Sabien Technology Group

SupplyMe Capital PLC

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SupplyMe Capital PLC are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, SupplyMe Capital unveiled solid returns over the last few months and may actually be approaching a breakup point.

Sabien Technology

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Sabien Technology Group are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak technical and fundamental indicators, Sabien Technology may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with SupplyMe Capital and Sabien Technology

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

The idea behind SupplyMe Capital PLC and Sabien Technology Group 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.