Correlation Between Schweizer Electronic and SINGAPORE AIRLINES
Can any of the company-specific risk be diversified away by investing in both Schweizer Electronic and SINGAPORE AIRLINES 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 Schweizer Electronic and SINGAPORE AIRLINES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Schweizer Electronic AG and SINGAPORE AIRLINES, you can compare the effects of market volatilities on Schweizer Electronic and SINGAPORE AIRLINES 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 Schweizer Electronic with a short position of SINGAPORE AIRLINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schweizer Electronic and SINGAPORE AIRLINES.
Diversification Opportunities for Schweizer Electronic and SINGAPORE AIRLINES
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Schweizer and SINGAPORE is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Schweizer Electronic AG and SINGAPORE AIRLINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SINGAPORE AIRLINES and Schweizer Electronic 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 Schweizer Electronic AG are associated (or correlated) with SINGAPORE AIRLINES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SINGAPORE AIRLINES has no effect on the direction of Schweizer Electronic i.e., Schweizer Electronic and SINGAPORE AIRLINES go up and down completely randomly.
Pair Corralation between Schweizer Electronic and SINGAPORE AIRLINES
Assuming the 90 days horizon Schweizer Electronic AG is expected to under-perform the SINGAPORE AIRLINES. In addition to that, Schweizer Electronic is 5.18 times more volatile than SINGAPORE AIRLINES. It trades about -0.15 of its total potential returns per unit of risk. SINGAPORE AIRLINES is currently generating about 0.1 per unit of volatility. If you would invest 440.00 in SINGAPORE AIRLINES on October 9, 2024 and sell it today you would earn a total of 14.00 from holding SINGAPORE AIRLINES or generate 3.18% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Schweizer Electronic AG vs. SINGAPORE AIRLINES
Performance |
Timeline |
Schweizer Electronic |
SINGAPORE AIRLINES |
Schweizer Electronic and SINGAPORE AIRLINES Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Schweizer Electronic and SINGAPORE AIRLINES
The main advantage of trading using opposite Schweizer Electronic and SINGAPORE AIRLINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Schweizer Electronic position performs unexpectedly, SINGAPORE AIRLINES 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 AIRLINES will offset losses from the drop in SINGAPORE AIRLINES's long position.Schweizer Electronic vs. Ibiden CoLtd | Schweizer Electronic vs. Benchmark Electronics | Schweizer Electronic vs. Meiko Electronics Co | Schweizer Electronic vs. Superior Plus Corp |
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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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