Correlation Between Singular Genomics and Intertek Group

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

By analyzing existing cross correlation between Singular Genomics Systems and Intertek Group Plc, you can compare the effects of market volatilities on Singular Genomics and Intertek Group 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 Singular Genomics with a short position of Intertek Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Singular Genomics and Intertek Group.

Diversification Opportunities for Singular Genomics and Intertek Group

-0.23

Correlation Coefficient

Singular Genomics  Intertek Group

Very good diversification

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

Pair Corralation between Singular Genomics and Intertek Group

Given the investment horizon of 90 days Singular Genomics Systems is expected to under-perform the Intertek Group. But the stock apears to be less risky and, when comparing its historical volatility, Singular Genomics Systems is 1.06 times less risky than Intertek Group. The stock trades about -0.08 of its potential returns per unit of risk. The Intertek Group Plc is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  5,900  in Intertek Group Plc on December 2, 2024 and sell it today you would earn a total of  555.00  from holding Intertek Group Plc or generate 9.41% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	91.8%
Values	Daily Returns

Singular Genomics Systems  vs.  Intertek Group Plc

Singular Genomics Systems

Risk-Adjusted Performance

Very Weak

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

Intertek Group Plc

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Intertek Group Plc are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, Intertek Group may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Singular Genomics and Intertek Group

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

The idea behind Singular Genomics Systems and Intertek Group Plc 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.