Correlation Between Yellow Corp and Saia

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

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

Diversification Opportunities for Yellow Corp and Saia

-0.54

Correlation Coefficient

Yellow Corp  Saia

Excellent diversification

The 3 months correlation between Yellow and Saia is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Yellow Corp and Saia Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saia Inc and Yellow Corp 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 Yellow Corp 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 Yellow Corp i.e., Yellow Corp and Saia go up and down completely randomly.

Pair Corralation between Yellow Corp and Saia

If you would invest  45,383  in Saia Inc on September 19, 2024 and sell it today you would earn a total of  5,686  from holding Saia Inc or generate 12.53% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	1.56%
Values	Daily Returns

Yellow Corp  vs.  Saia Inc

Yellow Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Yellow Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent essential indicators, Yellow Corp is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Saia Inc

Risk-Adjusted Performance

5 of 100

OK

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.

Pair Trading with Yellow Corp and Saia

The main advantage of trading using opposite Yellow Corp and Saia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yellow Corp 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 Yellow Corp 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.