Correlation Between Singapore ReinsuranceLimit and SPORT LISBOA
Can any of the company-specific risk be diversified away by investing in both Singapore ReinsuranceLimit and SPORT LISBOA 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 Singapore ReinsuranceLimit and SPORT LISBOA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Singapore Reinsurance and SPORT LISBOA E, you can compare the effects of market volatilities on Singapore ReinsuranceLimit and SPORT LISBOA 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 Singapore ReinsuranceLimit with a short position of SPORT LISBOA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Singapore ReinsuranceLimit and SPORT LISBOA.
Diversification Opportunities for Singapore ReinsuranceLimit and SPORT LISBOA
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Singapore and SPORT is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Singapore Reinsurance and SPORT LISBOA E in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPORT LISBOA E and Singapore ReinsuranceLimit 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 Singapore Reinsurance are associated (or correlated) with SPORT LISBOA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPORT LISBOA E has no effect on the direction of Singapore ReinsuranceLimit i.e., Singapore ReinsuranceLimit and SPORT LISBOA go up and down completely randomly.
Pair Corralation between Singapore ReinsuranceLimit and SPORT LISBOA
Assuming the 90 days trading horizon Singapore Reinsurance is expected to generate 0.8 times more return on investment than SPORT LISBOA. However, Singapore Reinsurance is 1.25 times less risky than SPORT LISBOA. It trades about 0.01 of its potential returns per unit of risk. SPORT LISBOA E is currently generating about -0.17 per unit of risk. If you would invest 3,500 in Singapore Reinsurance on October 5, 2024 and sell it today you would earn a total of 0.00 from holding Singapore Reinsurance or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Singapore Reinsurance vs. SPORT LISBOA E
Performance |
Timeline |
Singapore ReinsuranceLimit |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
SPORT LISBOA E |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Singapore ReinsuranceLimit and SPORT LISBOA Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Singapore ReinsuranceLimit and SPORT LISBOA
The main advantage of trading using opposite Singapore ReinsuranceLimit and SPORT LISBOA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Singapore ReinsuranceLimit position performs unexpectedly, SPORT LISBOA 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 SPORT LISBOA will offset losses from the drop in SPORT LISBOA's long position.The idea behind Singapore Reinsurance and SPORT LISBOA E 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |