Correlation Between AXWAY SOFTWARE and Singapore Telecommunicatio
Can any of the company-specific risk be diversified away by investing in both AXWAY SOFTWARE and Singapore Telecommunicatio 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 AXWAY SOFTWARE and Singapore Telecommunicatio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AXWAY SOFTWARE EO and Singapore Telecommunications Limited, you can compare the effects of market volatilities on AXWAY SOFTWARE and Singapore Telecommunicatio 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 AXWAY SOFTWARE with a short position of Singapore Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of AXWAY SOFTWARE and Singapore Telecommunicatio.
Diversification Opportunities for AXWAY SOFTWARE and Singapore Telecommunicatio
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between AXWAY and Singapore is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding AXWAY SOFTWARE EO and Singapore Telecommunications L in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Singapore Telecommunicatio and AXWAY SOFTWARE 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 AXWAY SOFTWARE EO are associated (or correlated) with Singapore Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Singapore Telecommunicatio has no effect on the direction of AXWAY SOFTWARE i.e., AXWAY SOFTWARE and Singapore Telecommunicatio go up and down completely randomly.
Pair Corralation between AXWAY SOFTWARE and Singapore Telecommunicatio
Assuming the 90 days horizon AXWAY SOFTWARE EO is expected to generate 0.81 times more return on investment than Singapore Telecommunicatio. However, AXWAY SOFTWARE EO is 1.23 times less risky than Singapore Telecommunicatio. It trades about 0.27 of its potential returns per unit of risk. Singapore Telecommunications Limited is currently generating about -0.06 per unit of risk. If you would invest 2,350 in AXWAY SOFTWARE EO on August 26, 2024 and sell it today you would earn a total of 410.00 from holding AXWAY SOFTWARE EO or generate 17.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AXWAY SOFTWARE EO vs. Singapore Telecommunications L
Performance |
| Timeline |
| AXWAY SOFTWARE EO |
| Singapore Telecommunicatio |
AXWAY SOFTWARE and Singapore Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AXWAY SOFTWARE and Singapore Telecommunicatio
The main advantage of trading using opposite AXWAY SOFTWARE and Singapore Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AXWAY SOFTWARE position performs unexpectedly, Singapore Telecommunicatio 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 Telecommunicatio will offset losses from the drop in Singapore Telecommunicatio's long position.| AXWAY SOFTWARE vs. BRIT AMER TOBACCO | AXWAY SOFTWARE vs. Commonwealth Bank of | AXWAY SOFTWARE vs. JAPAN TOBACCO UNSPADR12 | AXWAY SOFTWARE vs. Mizuho Financial Group |
| Singapore Telecommunicatio vs. Lifeway Foods | Singapore Telecommunicatio vs. VIAPLAY GROUP AB | Singapore Telecommunicatio vs. Ming Le Sports | Singapore Telecommunicatio vs. JJ SNACK FOODS |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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