Correlation Between Saia and Braskem SA

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

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

Diversification Opportunities for Saia and Braskem SA

-0.76

Correlation Coefficient

Saia  Braskem SA

Pay attention - limited upside

The 3 months correlation between Saia and Braskem is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Saia Inc and Braskem SA Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Braskem SA Class and Saia 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 Saia Inc are associated (or correlated) with Braskem SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Braskem SA Class has no effect on the direction of Saia i.e., Saia and Braskem SA go up and down completely randomly.

Pair Corralation between Saia and Braskem SA

Given the investment horizon of 90 days Saia Inc is expected to generate 0.91 times more return on investment than Braskem SA. However, Saia Inc is 1.1 times less risky than Braskem SA. It trades about 0.07 of its potential returns per unit of risk. Braskem SA Class is currently generating about -0.02 per unit of risk. If you would invest  23,889  in Saia Inc on September 4, 2024 and sell it today you would earn a total of  30,908  from holding Saia Inc or generate 129.38% return on investment over 90 days.

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

Saia Inc  vs.  Braskem SA Class

Saia Inc

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Saia Inc are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating forward indicators, Saia sustained solid returns over the last few months and may actually be approaching a breakup point.

Braskem SA Class

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Braskem SA Class has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Saia and Braskem SA

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

The idea behind Saia Inc and Braskem SA Class 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.

Check out your portfolio center.

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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.