Correlation Between Forward Air and SLM Corp

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

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

Diversification Opportunities for Forward Air and SLM Corp

0.23

Correlation Coefficient

Forward Air  SLM Corp

Modest diversification

The 3 months correlation between Forward and SLM is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Forward Air and SLM Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SLM Corp and Forward Air 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 Forward Air are associated (or correlated) with SLM Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SLM Corp has no effect on the direction of Forward Air i.e., Forward Air and SLM Corp go up and down completely randomly.

Pair Corralation between Forward Air and SLM Corp

Given the investment horizon of 90 days Forward Air is expected to generate 1.88 times more return on investment than SLM Corp. However, Forward Air is 1.88 times more volatile than SLM Corp. It trades about -0.04 of its potential returns per unit of risk. SLM Corp is currently generating about -0.2 per unit of risk. If you would invest  2,681  in Forward Air on July 4, 2025 and sell it today you would lose (291.00) from holding Forward Air or give up 10.85% of portfolio value over 90 days.

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

Forward Air  vs.  SLM Corp

Forward Air

Risk-Adjusted Performance

Weakest

Over the last 90 days Forward Air has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

SLM Corp

Risk-Adjusted Performance

Weakest

Over the last 90 days SLM Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's essential indicators remain very healthy which may send shares a bit higher in November 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Forward Air and SLM Corp

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

The idea behind Forward Air and SLM Corp 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 Global Correlations module to find global opportunities by holding instruments from different markets.