Correlation Between Singapore Telecommunicatio and Amazon
Can any of the company-specific risk be diversified away by investing in both Singapore Telecommunicatio and Amazon 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 Telecommunicatio and Amazon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Singapore Telecommunications Limited and Amazon Inc, you can compare the effects of market volatilities on Singapore Telecommunicatio and Amazon 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 Telecommunicatio with a short position of Amazon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Singapore Telecommunicatio and Amazon.
Diversification Opportunities for Singapore Telecommunicatio and Amazon
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Singapore and Amazon is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Singapore Telecommunications L and Amazon Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amazon Inc and Singapore Telecommunicatio 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 Telecommunications Limited are associated (or correlated) with Amazon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amazon Inc has no effect on the direction of Singapore Telecommunicatio i.e., Singapore Telecommunicatio and Amazon go up and down completely randomly.
Pair Corralation between Singapore Telecommunicatio and Amazon
Assuming the 90 days trading horizon Singapore Telecommunications Limited is expected to generate 0.91 times more return on investment than Amazon. However, Singapore Telecommunications Limited is 1.1 times less risky than Amazon. It trades about 0.07 of its potential returns per unit of risk. Amazon Inc is currently generating about -0.16 per unit of risk. If you would invest 221.00 in Singapore Telecommunications Limited on December 30, 2024 and sell it today you would earn a total of 14.00 from holding Singapore Telecommunications Limited or generate 6.33% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Singapore Telecommunications L vs. Amazon Inc
Performance |
Timeline |
Singapore Telecommunicatio |
Amazon Inc |
Singapore Telecommunicatio and Amazon Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Singapore Telecommunicatio and Amazon
The main advantage of trading using opposite Singapore Telecommunicatio and Amazon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Singapore Telecommunicatio position performs unexpectedly, Amazon 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 Amazon will offset losses from the drop in Amazon's long position.Singapore Telecommunicatio vs. GRUPO CARSO A1 | Singapore Telecommunicatio vs. Cairo Communication SpA | Singapore Telecommunicatio vs. QLEANAIR AB SK 50 | Singapore Telecommunicatio vs. INTER CARS SA |
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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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