Correlation Between Daito Trust and SINGAPORE AIRLINES
Can any of the company-specific risk be diversified away by investing in both Daito Trust and SINGAPORE AIRLINES 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 Daito Trust and SINGAPORE AIRLINES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daito Trust Construction and SINGAPORE AIRLINES, you can compare the effects of market volatilities on Daito Trust and SINGAPORE AIRLINES 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 Daito Trust with a short position of SINGAPORE AIRLINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daito Trust and SINGAPORE AIRLINES.
Diversification Opportunities for Daito Trust and SINGAPORE AIRLINES
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Daito and SINGAPORE is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Daito Trust Construction and SINGAPORE AIRLINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SINGAPORE AIRLINES and Daito Trust 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 Daito Trust Construction are associated (or correlated) with SINGAPORE AIRLINES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SINGAPORE AIRLINES has no effect on the direction of Daito Trust i.e., Daito Trust and SINGAPORE AIRLINES go up and down completely randomly.
Pair Corralation between Daito Trust and SINGAPORE AIRLINES
Assuming the 90 days horizon Daito Trust Construction is expected to under-perform the SINGAPORE AIRLINES. But the stock apears to be less risky and, when comparing its historical volatility, Daito Trust Construction is 1.01 times less risky than SINGAPORE AIRLINES. The stock trades about -0.05 of its potential returns per unit of risk. The SINGAPORE AIRLINES is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 444.00 in SINGAPORE AIRLINES on October 18, 2024 and sell it today you would lose (3.00) from holding SINGAPORE AIRLINES or give up 0.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daito Trust Construction vs. SINGAPORE AIRLINES
Performance |
| Timeline |
| Daito Trust Construction |
| SINGAPORE AIRLINES |
Daito Trust and SINGAPORE AIRLINES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daito Trust and SINGAPORE AIRLINES
The main advantage of trading using opposite Daito Trust and SINGAPORE AIRLINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daito Trust position performs unexpectedly, SINGAPORE AIRLINES 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 AIRLINES will offset losses from the drop in SINGAPORE AIRLINES's long position.| Daito Trust vs. China Eastern Airlines | Daito Trust vs. Tencent Music Entertainment | Daito Trust vs. REMEDY ENTERTAINMENT OYJ | Daito Trust vs. United Airlines Holdings |
| SINGAPORE AIRLINES vs. FLOW TRADERS LTD | SINGAPORE AIRLINES vs. The Trade Desk | SINGAPORE AIRLINES vs. ASPEN TECHINC DL | SINGAPORE AIRLINES vs. Treasury Wine Estates |
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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