Correlation Between Singapore Airlines and RadNet
Can any of the company-specific risk be diversified away by investing in both Singapore Airlines and RadNet 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 Airlines and RadNet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Singapore Airlines and RadNet Inc, you can compare the effects of market volatilities on Singapore Airlines and RadNet 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 Airlines with a short position of RadNet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Singapore Airlines and RadNet.
Diversification Opportunities for Singapore Airlines and RadNet
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Singapore and RadNet is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Singapore Airlines and RadNet Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RadNet Inc and Singapore Airlines 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 Airlines are associated (or correlated) with RadNet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RadNet Inc has no effect on the direction of Singapore Airlines i.e., Singapore Airlines and RadNet go up and down completely randomly.
Pair Corralation between Singapore Airlines and RadNet
Assuming the 90 days horizon Singapore Airlines is expected to generate 0.56 times more return on investment than RadNet. However, Singapore Airlines is 1.77 times less risky than RadNet. It trades about -0.07 of its potential returns per unit of risk. RadNet Inc is currently generating about -0.23 per unit of risk. If you would invest 948.00 in Singapore Airlines on October 11, 2024 and sell it today you would lose (14.00) from holding Singapore Airlines or give up 1.48% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Singapore Airlines vs. RadNet Inc
Performance |
Timeline |
Singapore Airlines |
RadNet Inc |
Singapore Airlines and RadNet Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Singapore Airlines and RadNet
The main advantage of trading using opposite Singapore Airlines and RadNet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Singapore Airlines position performs unexpectedly, RadNet 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 RadNet will offset losses from the drop in RadNet's long position.Singapore Airlines vs. Cathay Pacific Airways | Singapore Airlines vs. Qantas Airways Ltd | Singapore Airlines vs. International Consolidated Airlines | Singapore Airlines vs. Singapore Airlines |
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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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