Correlation Between SECURITAS and Superior Industries

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

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

Diversification Opportunities for SECURITAS and Superior Industries

-0.11

Correlation Coefficient

SECURITAS  Superior Industries

Good diversification

The 3 months correlation between SECURITAS and Superior is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding SECURITAS B and Superior Industries Internatio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Superior Industries and SECURITAS 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 SECURITAS B are associated (or correlated) with Superior Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Superior Industries has no effect on the direction of SECURITAS i.e., SECURITAS and Superior Industries go up and down completely randomly.

Pair Corralation between SECURITAS and Superior Industries

Assuming the 90 days trading horizon SECURITAS B is expected to generate 0.2 times more return on investment than Superior Industries. However, SECURITAS B is 5.04 times less risky than Superior Industries. It trades about 0.02 of its potential returns per unit of risk. Superior Industries International is currently generating about -0.16 per unit of risk. If you would invest  1,281  in SECURITAS B on April 20, 2025 and sell it today you would earn a total of  13.00  from holding SECURITAS B or generate 1.01% return on investment over 90 days.

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

SECURITAS B   vs.  Superior Industries Internatio

SECURITAS B

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SECURITAS B are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, SECURITAS is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Superior Industries

Risk-Adjusted Performance

Very Weak

Over the last 90 days Superior Industries International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in August 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with SECURITAS and Superior Industries

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

The idea behind SECURITAS B and Superior Industries International 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.