Correlation Between Esprinet SpA and Singapore Airlines
Can any of the company-specific risk be diversified away by investing in both Esprinet SpA 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 Esprinet SpA and Singapore Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Esprinet SpA and Singapore Airlines Limited, you can compare the effects of market volatilities on Esprinet SpA 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 Esprinet SpA with a short position of Singapore Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Esprinet SpA and Singapore Airlines.
Diversification Opportunities for Esprinet SpA and Singapore Airlines
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Esprinet and Singapore is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Esprinet SpA and Singapore Airlines Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Singapore Airlines and Esprinet SpA 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 Esprinet SpA 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 Esprinet SpA i.e., Esprinet SpA and Singapore Airlines go up and down completely randomly.
Pair Corralation between Esprinet SpA and Singapore Airlines
Assuming the 90 days trading horizon Esprinet SpA is expected to generate 1.62 times more return on investment than Singapore Airlines. However, Esprinet SpA is 1.62 times more volatile than Singapore Airlines Limited. It trades about 0.12 of its potential returns per unit of risk. Singapore Airlines Limited is currently generating about -0.2 per unit of risk. If you would invest 422.00 in Esprinet SpA on October 29, 2024 and sell it today you would earn a total of 13.00 from holding Esprinet SpA or generate 3.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Esprinet SpA vs. Singapore Airlines Limited
Performance |
| Timeline |
| Esprinet SpA |
| Singapore Airlines |
Esprinet SpA and Singapore Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Esprinet SpA and Singapore Airlines
The main advantage of trading using opposite Esprinet SpA and Singapore Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Esprinet SpA 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.| Esprinet SpA vs. Keck Seng Investments | Esprinet SpA vs. MCEWEN MINING INC | Esprinet SpA vs. MAG SILVER | Esprinet SpA vs. Endeavour Mining PLC |
| Singapore Airlines vs. Nippon Light Metal | Singapore Airlines vs. PARKEN Sport Entertainment | Singapore Airlines vs. CARDINAL HEALTH | Singapore Airlines vs. PURETECH HEALTH PLC |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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