Correlation Between Saia and TWFG,

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

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

Diversification Opportunities for Saia and TWFG,

0.79

Correlation Coefficient

Saia  TWFG,

Poor diversification

The 3 months correlation between Saia and TWFG, is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Saia Inc and TWFG, Class A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TWFG, Class A 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 TWFG,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TWFG, Class A has no effect on the direction of Saia i.e., Saia and TWFG, go up and down completely randomly.

Pair Corralation between Saia and TWFG,

Given the investment horizon of 90 days Saia Inc is expected to generate 0.64 times more return on investment than TWFG,. However, Saia Inc is 1.57 times less risky than TWFG,. It trades about -0.15 of its potential returns per unit of risk. TWFG, Class A is currently generating about -0.17 per unit of risk. If you would invest  53,000  in Saia Inc on September 21, 2024 and sell it today you would lose (3,507) from holding Saia Inc or give up 6.62% of portfolio value over 90 days.

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

Saia Inc  vs.  TWFG, Class A

Saia Inc

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Saia Inc are ranked lower than 5 (%) 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.

TWFG, Class A

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in TWFG, Class A are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical and fundamental indicators, TWFG, is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Saia and TWFG,

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

The idea behind Saia Inc and TWFG, Class A 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.