Correlation Between Safety Shot and CapitaLand Investment
Can any of the company-specific risk be diversified away by investing in both Safety Shot and CapitaLand Investment 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 Safety Shot and CapitaLand Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Safety Shot and CapitaLand Investment Limited, you can compare the effects of market volatilities on Safety Shot and CapitaLand Investment 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 Safety Shot with a short position of CapitaLand Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Safety Shot and CapitaLand Investment.
Diversification Opportunities for Safety Shot and CapitaLand Investment
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Safety and CapitaLand is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Safety Shot and CapitaLand Investment Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CapitaLand Investment and Safety Shot 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 Safety Shot are associated (or correlated) with CapitaLand Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CapitaLand Investment has no effect on the direction of Safety Shot i.e., Safety Shot and CapitaLand Investment go up and down completely randomly.
Pair Corralation between Safety Shot and CapitaLand Investment
Given the investment horizon of 90 days Safety Shot is expected to generate 1.69 times more return on investment than CapitaLand Investment. However, Safety Shot is 1.69 times more volatile than CapitaLand Investment Limited. It trades about 0.04 of its potential returns per unit of risk. CapitaLand Investment Limited is currently generating about 0.02 per unit of risk. If you would invest 77.00 in Safety Shot on September 23, 2024 and sell it today you would lose (5.00) from holding Safety Shot or give up 6.49% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Safety Shot vs. CapitaLand Investment Limited
Performance |
Timeline |
Safety Shot |
CapitaLand Investment |
Safety Shot and CapitaLand Investment Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Safety Shot and CapitaLand Investment
The main advantage of trading using opposite Safety Shot and CapitaLand Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Safety Shot position performs unexpectedly, CapitaLand Investment 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 CapitaLand Investment will offset losses from the drop in CapitaLand Investment's long position.Safety Shot vs. Origin Materials | Safety Shot vs. Eastman Chemical | Safety Shot vs. Xiabuxiabu Catering Management | Safety Shot vs. Hudson Technologies |
CapitaLand Investment vs. IRSA Inversiones Y | CapitaLand Investment vs. Anywhere Real Estate | CapitaLand Investment vs. Newmark Group | CapitaLand Investment vs. Wharf Real Estate |
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 CEOs Directory module to screen CEOs from public companies around the world.
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