Correlation Between Singatron Enterprise and Sonix Technology

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

By analyzing existing cross correlation between Singatron Enterprise Co and Sonix Technology Co, you can compare the effects of market volatilities on Singatron Enterprise and Sonix Technology 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 Singatron Enterprise with a short position of Sonix Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Singatron Enterprise and Sonix Technology.

Diversification Opportunities for Singatron Enterprise and Sonix Technology

0.35

Correlation Coefficient

Singatron Enterprise  Sonix Technology

Weak diversification

The 3 months correlation between Singatron and Sonix is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Singatron Enterprise Co and Sonix Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sonix Technology and Singatron Enterprise 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 Singatron Enterprise Co are associated (or correlated) with Sonix Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sonix Technology has no effect on the direction of Singatron Enterprise i.e., Singatron Enterprise and Sonix Technology go up and down completely randomly.

Pair Corralation between Singatron Enterprise and Sonix Technology

Assuming the 90 days trading horizon Singatron Enterprise Co is expected to under-perform the Sonix Technology. But the stock apears to be less risky and, when comparing its historical volatility, Singatron Enterprise Co is 1.16 times less risky than Sonix Technology. The stock trades about -0.06 of its potential returns per unit of risk. The Sonix Technology Co is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  4,030  in Sonix Technology Co on December 25, 2024 and sell it today you would earn a total of  40.00  from holding Sonix Technology Co or generate 0.99% return on investment over 90 days.

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

Singatron Enterprise Co  vs.  Sonix Technology Co

Singatron Enterprise

Risk-Adjusted Performance

Very Weak

Over the last 90 days Singatron Enterprise Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Singatron Enterprise is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Sonix Technology

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Sonix Technology Co are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Sonix Technology is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Singatron Enterprise and Sonix Technology

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

The idea behind Singatron Enterprise Co and Sonix Technology Co 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.

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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.