Correlation Between FIH MOBILE and Singapore Telecommunicatio

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

By analyzing existing cross correlation between FIH MOBILE and Singapore Telecommunications Limited, you can compare the effects of market volatilities on FIH MOBILE and Singapore Telecommunicatio 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 FIH MOBILE with a short position of Singapore Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIH MOBILE and Singapore Telecommunicatio.

Diversification Opportunities for FIH MOBILE and Singapore Telecommunicatio

-0.6

Correlation Coefficient

FIH MOBILE  Singapore Telecommunicatio

Excellent diversification

The 3 months correlation between FIH and Singapore is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding FIH MOBILE and Singapore Telecommunications L in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Singapore Telecommunicatio and FIH MOBILE 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 FIH MOBILE are associated (or correlated) with Singapore Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Singapore Telecommunicatio has no effect on the direction of FIH MOBILE i.e., FIH MOBILE and Singapore Telecommunicatio go up and down completely randomly.

Pair Corralation between FIH MOBILE and Singapore Telecommunicatio

Assuming the 90 days trading horizon FIH MOBILE is expected to generate 2.02 times less return on investment than Singapore Telecommunicatio. In addition to that, FIH MOBILE is 1.97 times more volatile than Singapore Telecommunications Limited. It trades about 0.02 of its total potential returns per unit of risk. Singapore Telecommunications Limited is currently generating about 0.07 per unit of volatility. If you would invest  218.00  in Singapore Telecommunications Limited on December 22, 2024 and sell it today you would earn a total of  13.00  from holding Singapore Telecommunications Limited or generate 5.96% return on investment over 90 days.

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

FIH MOBILE  vs.  Singapore Telecommunications L

FIH MOBILE

Risk-Adjusted Performance

Weak

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

Singapore Telecommunicatio

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Singapore Telecommunications Limited are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Singapore Telecommunicatio may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with FIH MOBILE and Singapore Telecommunicatio

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

The idea behind FIH MOBILE and Singapore Telecommunications Limited 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.