Correlation Between Sabre Corpo and Cencora

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

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

Diversification Opportunities for Sabre Corpo and Cencora

0.15

Correlation Coefficient

Sabre Corpo  Cencora

Average diversification

The 3 months correlation between Sabre and Cencora is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Sabre Corpo and Cencora in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cencora and Sabre Corpo 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 Sabre Corpo are associated (or correlated) with Cencora. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cencora has no effect on the direction of Sabre Corpo i.e., Sabre Corpo and Cencora go up and down completely randomly.

Pair Corralation between Sabre Corpo and Cencora

Given the investment horizon of 90 days Sabre Corpo is expected to generate 1.21 times more return on investment than Cencora. However, Sabre Corpo is 1.21 times more volatile than Cencora. It trades about 0.55 of its potential returns per unit of risk. Cencora is currently generating about 0.33 per unit of risk. If you would invest  320.00  in Sabre Corpo on September 1, 2024 and sell it today you would earn a total of  71.00  from holding Sabre Corpo or generate 22.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Sabre Corpo  vs.  Cencora

Sabre Corpo

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Sabre Corpo are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak fundamental drivers, Sabre Corpo reported solid returns over the last few months and may actually be approaching a breakup point.

Cencora

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Cencora are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Cencora is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Sabre Corpo and Cencora

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

The idea behind Sabre Corpo and Cencora 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.