Correlation Between Micron Technology and Singapore Telecommunicatio
Can any of the company-specific risk be diversified away by investing in both Micron Technology 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 Micron Technology and Singapore Telecommunicatio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Micron Technology and Singapore Telecommunications Limited, you can compare the effects of market volatilities on Micron Technology 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 Micron Technology with a short position of Singapore Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Micron Technology and Singapore Telecommunicatio.
Diversification Opportunities for Micron Technology and Singapore Telecommunicatio
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Micron and Singapore is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Micron Technology and Singapore Telecommunications L in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Singapore Telecommunicatio and Micron Technology 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 Micron Technology 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 Micron Technology i.e., Micron Technology and Singapore Telecommunicatio go up and down completely randomly.
Pair Corralation between Micron Technology and Singapore Telecommunicatio
Assuming the 90 days trading horizon Micron Technology is expected to under-perform the Singapore Telecommunicatio. In addition to that, Micron Technology is 1.29 times more volatile than Singapore Telecommunications Limited. It trades about 0.0 of its total potential returns per unit of risk. Singapore Telecommunications Limited is currently generating about 0.02 per unit of volatility. If you would invest 214.00 in Singapore Telecommunications Limited on September 13, 2024 and sell it today you would earn a total of 1.00 from holding Singapore Telecommunications Limited or generate 0.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Micron Technology vs. Singapore Telecommunications L
Performance |
| Timeline |
| Micron Technology |
| Singapore Telecommunicatio |
Micron Technology and Singapore Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Micron Technology and Singapore Telecommunicatio
The main advantage of trading using opposite Micron Technology and Singapore Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Micron Technology 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.| Micron Technology vs. Apple Inc | Micron Technology vs. Apple Inc | Micron Technology vs. Apple Inc | Micron Technology vs. Apple 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |