Correlation Between TFI International and Saia

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

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

Diversification Opportunities for TFI International and Saia

0.39

Correlation Coefficient

TFI International  Saia

Weak diversification

The 3 months correlation between TFI and Saia is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding TFI International and Saia Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saia Inc and TFI International 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 TFI International are associated (or correlated) with Saia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saia Inc has no effect on the direction of TFI International i.e., TFI International and Saia go up and down completely randomly.

Pair Corralation between TFI International and Saia

Given the investment horizon of 90 days TFI International is expected to generate 2.38 times less return on investment than Saia. But when comparing it to its historical volatility, TFI International is 1.54 times less risky than Saia. It trades about 0.05 of its potential returns per unit of risk. Saia Inc is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  23,548  in Saia Inc on September 3, 2024 and sell it today you would earn a total of  33,360  from holding Saia Inc or generate 141.67% return on investment over 90 days.

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

TFI International  vs.  Saia Inc

TFI International

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in TFI International are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, TFI International is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Saia Inc

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Saia Inc are ranked lower than 16 (%) 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.

Pair Trading with TFI International and Saia

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

The idea behind TFI International and Saia Inc 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.