Correlation Between Monument Mining and Singapore Airlines
Can any of the company-specific risk be diversified away by investing in both Monument Mining 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 Monument Mining and Singapore Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Monument Mining Limited and Singapore Airlines Limited, you can compare the effects of market volatilities on Monument Mining 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 Monument Mining with a short position of Singapore Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monument Mining and Singapore Airlines.
Diversification Opportunities for Monument Mining and Singapore Airlines
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Monument and Singapore is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Monument Mining Limited and Singapore Airlines Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Singapore Airlines and Monument Mining 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 Monument Mining 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 Monument Mining i.e., Monument Mining and Singapore Airlines go up and down completely randomly.
Pair Corralation between Monument Mining and Singapore Airlines
Assuming the 90 days trading horizon Monument Mining Limited is expected to generate 4.93 times more return on investment than Singapore Airlines. However, Monument Mining is 4.93 times more volatile than Singapore Airlines Limited. It trades about 0.08 of its potential returns per unit of risk. Singapore Airlines Limited is currently generating about 0.05 per unit of risk. If you would invest 19.00 in Monument Mining Limited on November 6, 2024 and sell it today you would earn a total of 3.00 from holding Monument Mining Limited or generate 15.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Monument Mining Limited vs. Singapore Airlines Limited
Performance |
| Timeline |
| Monument Mining |
| Singapore Airlines |
Monument Mining and Singapore Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Monument Mining and Singapore Airlines
The main advantage of trading using opposite Monument Mining and Singapore Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monument Mining 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' long position.| Monument Mining vs. AWILCO DRILLING PLC | Monument Mining vs. MAANSHAN IRON H | Monument Mining vs. STEEL DYNAMICS | Monument Mining vs. CALTAGIRONE EDITORE |
| Singapore Airlines vs. ADRIATIC METALS LS 013355 | Singapore Airlines vs. De Grey Mining | Singapore Airlines vs. Harmony Gold Mining | Singapore Airlines vs. CORNISH METALS INC |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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