Correlation Between Singatron Enterprise and Scan D

Can any of the company-specific risk be diversified away by investing in both Singatron Enterprise and Scan D 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 Scan D 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 Scan D, you can compare the effects of market volatilities on Singatron Enterprise and Scan D 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 Scan D. Check out your portfolio center. Please also check ongoing floating volatility patterns of Singatron Enterprise and Scan D.

Diversification Opportunities for Singatron Enterprise and Scan D

0.39

Correlation Coefficient

Singatron Enterprise  Scan D

Weak diversification

The 3 months correlation between Singatron and Scan is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Singatron Enterprise Co and Scan D in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scan D 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 Scan D. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scan D has no effect on the direction of Singatron Enterprise i.e., Singatron Enterprise and Scan D go up and down completely randomly.

Pair Corralation between Singatron Enterprise and Scan D

Assuming the 90 days trading horizon Singatron Enterprise Co is expected to under-perform the Scan D. In addition to that, Singatron Enterprise is 1.16 times more volatile than Scan D. It trades about -0.06 of its total potential returns per unit of risk. Scan D is currently generating about -0.04 per unit of volatility. If you would invest  3,475  in Scan D on December 25, 2024 and sell it today you would lose (100.00) from holding Scan D or give up 2.88% of portfolio value over 90 days.

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

Singatron Enterprise Co  vs.  Scan D

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.

Scan D

Risk-Adjusted Performance

Very Weak

Over the last 90 days Scan D has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Scan D 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 Scan D

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

The idea behind Singatron Enterprise Co and Scan D 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.