Correlation Between KAUFMAN ET and Singapore Reinsurance
Can any of the company-specific risk be diversified away by investing in both KAUFMAN ET and Singapore Reinsurance 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 KAUFMAN ET and Singapore Reinsurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KAUFMAN ET BROAD and Singapore Reinsurance, you can compare the effects of market volatilities on KAUFMAN ET and Singapore Reinsurance 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 KAUFMAN ET with a short position of Singapore Reinsurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of KAUFMAN ET and Singapore Reinsurance.
Diversification Opportunities for KAUFMAN ET and Singapore Reinsurance
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between KAUFMAN and Singapore is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding KAUFMAN ET BROAD and Singapore Reinsurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Singapore Reinsurance and KAUFMAN ET 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 KAUFMAN ET BROAD are associated (or correlated) with Singapore Reinsurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Singapore Reinsurance has no effect on the direction of KAUFMAN ET i.e., KAUFMAN ET and Singapore Reinsurance go up and down completely randomly.
Pair Corralation between KAUFMAN ET and Singapore Reinsurance
Assuming the 90 days trading horizon KAUFMAN ET is expected to generate 133.33 times less return on investment than Singapore Reinsurance. But when comparing it to its historical volatility, KAUFMAN ET BROAD is 1.34 times less risky than Singapore Reinsurance. It trades about 0.0 of its potential returns per unit of risk. Singapore Reinsurance is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 3,120 in Singapore Reinsurance on August 31, 2024 and sell it today you would earn a total of 360.00 from holding Singapore Reinsurance or generate 11.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KAUFMAN ET BROAD vs. Singapore Reinsurance
Performance |
| Timeline |
| KAUFMAN ET BROAD |
| Singapore Reinsurance |
KAUFMAN ET and Singapore Reinsurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KAUFMAN ET and Singapore Reinsurance
The main advantage of trading using opposite KAUFMAN ET and Singapore Reinsurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KAUFMAN ET position performs unexpectedly, Singapore Reinsurance 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 Reinsurance will offset losses from the drop in Singapore Reinsurance's long position.| KAUFMAN ET vs. Direct Line Insurance | KAUFMAN ET vs. Zijin Mining Group | KAUFMAN ET vs. Lion One Metals | KAUFMAN ET vs. Japan Post Insurance |
| Singapore Reinsurance vs. ScanSource | Singapore Reinsurance vs. TYSON FOODS A | Singapore Reinsurance vs. ULTRA CLEAN HLDGS | Singapore Reinsurance vs. Cleanaway Waste Management |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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