Correlation Between Security National and KING PHARMACEUTICALS
Can any of the company-specific risk be diversified away by investing in both Security National and KING PHARMACEUTICALS 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 Security National and KING PHARMACEUTICALS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Security National Financial and KING PHARMACEUTICALS INC, you can compare the effects of market volatilities on Security National and KING PHARMACEUTICALS 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 Security National with a short position of KING PHARMACEUTICALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Security National and KING PHARMACEUTICALS.
Diversification Opportunities for Security National and KING PHARMACEUTICALS
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Security and KING is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Security National Financial and KING PHARMACEUTICALS INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KING PHARMACEUTICALS INC and Security National 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 Security National Financial are associated (or correlated) with KING PHARMACEUTICALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KING PHARMACEUTICALS INC has no effect on the direction of Security National i.e., Security National and KING PHARMACEUTICALS go up and down completely randomly.
Pair Corralation between Security National and KING PHARMACEUTICALS
Assuming the 90 days horizon Security National Financial is expected to generate 0.56 times more return on investment than KING PHARMACEUTICALS. However, Security National Financial is 1.77 times less risky than KING PHARMACEUTICALS. It trades about -0.07 of its potential returns per unit of risk. KING PHARMACEUTICALS INC is currently generating about -0.18 per unit of risk. If you would invest 913.00 in Security National Financial on August 14, 2025 and sell it today you would lose (95.00) from holding Security National Financial or give up 10.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 96.83% |
| Values | Daily Returns |
Security National Financial vs. KING PHARMACEUTICALS INC
Performance |
| Timeline |
| Security National |
| KING PHARMACEUTICALS INC |
Security National and KING PHARMACEUTICALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Security National and KING PHARMACEUTICALS
The main advantage of trading using opposite Security National and KING PHARMACEUTICALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Security National position performs unexpectedly, KING PHARMACEUTICALS 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 KING PHARMACEUTICALS will offset losses from the drop in KING PHARMACEUTICALS's long position.| Security National vs. First Savings Financial | Security National vs. Greystone Housing Impact | Security National vs. OP Bancorp | Security National vs. Consumer Portfolio Services |
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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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