Correlation Between NYSE Composite and Singapore Technologies
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Singapore Technologies 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 NYSE Composite and Singapore Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Singapore Technologies Engineering, you can compare the effects of market volatilities on NYSE Composite and Singapore Technologies 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 NYSE Composite with a short position of Singapore Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Singapore Technologies.
Diversification Opportunities for NYSE Composite and Singapore Technologies
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between NYSE and Singapore is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Singapore Technologies Enginee in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Singapore Technologies and NYSE Composite 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 NYSE Composite are associated (or correlated) with Singapore Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Singapore Technologies has no effect on the direction of NYSE Composite i.e., NYSE Composite and Singapore Technologies go up and down completely randomly.
Pair Corralation between NYSE Composite and Singapore Technologies
Assuming the 90 days trading horizon NYSE Composite is expected to generate 1.44 times less return on investment than Singapore Technologies. But when comparing it to its historical volatility, NYSE Composite is 2.55 times less risky than Singapore Technologies. It trades about 0.11 of its potential returns per unit of risk. Singapore Technologies Engineering is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 2,590 in Singapore Technologies Engineering on September 4, 2024 and sell it today you would earn a total of 940.00 from holding Singapore Technologies Engineering or generate 36.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 92.23% |
| Values | Daily Returns |
NYSE Composite vs. Singapore Technologies Enginee
Performance |
| Timeline |
NYSE Composite and Singapore Technologies Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Singapore Technologies Engineering
Pair trading matchups for Singapore Technologies
Pair Trading with NYSE Composite and Singapore Technologies
The main advantage of trading using opposite NYSE Composite and Singapore Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Singapore Technologies 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 Technologies will offset losses from the drop in Singapore Technologies' long position.| NYSE Composite vs. Kite Realty Group | NYSE Composite vs. Tradeweb Markets | NYSE Composite vs. Meiwu Technology Co | NYSE Composite vs. Uber Technologies |
| Singapore Technologies vs. Rolls Royce Holdings PLC | Singapore Technologies vs. VirTra Inc | Singapore Technologies vs. BWX Technologies | Singapore Technologies vs. Embraer SA ADR |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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