Correlation Between Astral Foods and SINGAPORE AIRLINES
Can any of the company-specific risk be diversified away by investing in both Astral Foods 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 Astral Foods and SINGAPORE AIRLINES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astral Foods Limited and SINGAPORE AIRLINES, you can compare the effects of market volatilities on Astral Foods 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 Astral Foods with a short position of SINGAPORE AIRLINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astral Foods and SINGAPORE AIRLINES.
Diversification Opportunities for Astral Foods and SINGAPORE AIRLINES
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Astral and SINGAPORE is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Astral Foods Limited and SINGAPORE AIRLINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SINGAPORE AIRLINES and Astral Foods 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 Astral Foods Limited 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 Astral Foods i.e., Astral Foods and SINGAPORE AIRLINES go up and down completely randomly.
Pair Corralation between Astral Foods and SINGAPORE AIRLINES
Assuming the 90 days trading horizon Astral Foods Limited is expected to under-perform the SINGAPORE AIRLINES. In addition to that, Astral Foods is 2.42 times more volatile than SINGAPORE AIRLINES. It trades about -0.17 of its total potential returns per unit of risk. SINGAPORE AIRLINES is currently generating about 0.0 per unit of volatility. If you would invest 454.00 in SINGAPORE AIRLINES on October 11, 2024 and sell it today you would earn a total of 0.00 from holding SINGAPORE AIRLINES or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astral Foods Limited vs. SINGAPORE AIRLINES
Performance |
| Timeline |
| Astral Foods Limited |
| SINGAPORE AIRLINES |
Astral Foods and SINGAPORE AIRLINES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astral Foods and SINGAPORE AIRLINES
The main advantage of trading using opposite Astral Foods and SINGAPORE AIRLINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astral Foods 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.| Astral Foods vs. BORR DRILLING NEW | Astral Foods vs. Virtu Financial | Astral Foods vs. SOUTHWEST AIRLINES | Astral Foods vs. Synovus Financial Corp |
| SINGAPORE AIRLINES vs. Titan Machinery | SINGAPORE AIRLINES vs. Nufarm Limited | SINGAPORE AIRLINES vs. Endeavour Mining PLC | SINGAPORE AIRLINES vs. WIMFARM SA EO |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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