Correlation Between LINMON MEDIA and Singapore Telecommunicatio
Can any of the company-specific risk be diversified away by investing in both LINMON MEDIA 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 LINMON MEDIA and Singapore Telecommunicatio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LINMON MEDIA LTD and Singapore Telecommunications Limited, you can compare the effects of market volatilities on LINMON MEDIA 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 LINMON MEDIA with a short position of Singapore Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of LINMON MEDIA and Singapore Telecommunicatio.
Diversification Opportunities for LINMON MEDIA and Singapore Telecommunicatio
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between LINMON and Singapore is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding LINMON MEDIA LTD and Singapore Telecommunications L in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Singapore Telecommunicatio and LINMON MEDIA 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 LINMON MEDIA LTD 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 LINMON MEDIA i.e., LINMON MEDIA and Singapore Telecommunicatio go up and down completely randomly.
Pair Corralation between LINMON MEDIA and Singapore Telecommunicatio
Assuming the 90 days horizon LINMON MEDIA LTD is expected to under-perform the Singapore Telecommunicatio. In addition to that, LINMON MEDIA is 2.95 times more volatile than Singapore Telecommunications Limited. It trades about -0.1 of its total potential returns per unit of risk. Singapore Telecommunications Limited is currently generating about 0.03 per unit of volatility. If you would invest 231.00 in Singapore Telecommunications Limited on December 26, 2024 and sell it today you would earn a total of 2.00 from holding Singapore Telecommunications Limited or generate 0.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
LINMON MEDIA LTD vs. Singapore Telecommunications L
Performance |
| Timeline |
| LINMON MEDIA LTD |
| Singapore Telecommunicatio |
LINMON MEDIA and Singapore Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LINMON MEDIA and Singapore Telecommunicatio
The main advantage of trading using opposite LINMON MEDIA and Singapore Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LINMON MEDIA 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.| LINMON MEDIA vs. KIMBALL ELECTRONICS | LINMON MEDIA vs. LG Electronics | LINMON MEDIA vs. Taiwan Semiconductor Manufacturing | LINMON MEDIA vs. Renesas Electronics |
| Singapore Telecommunicatio vs. Air Transport Services | Singapore Telecommunicatio vs. Ming Le Sports | Singapore Telecommunicatio vs. SCIENCE IN SPORT | Singapore Telecommunicatio vs. Tsingtao Brewery |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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