Correlation Between PENN Entertainment and Singapore Telecommunicatio
Can any of the company-specific risk be diversified away by investing in both PENN Entertainment 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 PENN Entertainment and Singapore Telecommunicatio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PENN Entertainment and Singapore Telecommunications Limited, you can compare the effects of market volatilities on PENN Entertainment 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 PENN Entertainment with a short position of Singapore Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of PENN Entertainment and Singapore Telecommunicatio.
Diversification Opportunities for PENN Entertainment and Singapore Telecommunicatio
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between PENN and Singapore is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding PENN Entertainment and Singapore Telecommunications L in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Singapore Telecommunicatio and PENN Entertainment 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 PENN Entertainment 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 PENN Entertainment i.e., PENN Entertainment and Singapore Telecommunicatio go up and down completely randomly.
Pair Corralation between PENN Entertainment and Singapore Telecommunicatio
Assuming the 90 days trading horizon PENN Entertainment is expected to generate 2.51 times more return on investment than Singapore Telecommunicatio. However, PENN Entertainment is 2.51 times more volatile than Singapore Telecommunications Limited. It trades about 0.14 of its potential returns per unit of risk. Singapore Telecommunications Limited is currently generating about 0.06 per unit of risk. If you would invest 1,759 in PENN Entertainment on October 29, 2024 and sell it today you would earn a total of 142.00 from holding PENN Entertainment or generate 8.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PENN Entertainment vs. Singapore Telecommunications L
Performance |
| Timeline |
| PENN Entertainment |
| Singapore Telecommunicatio |
PENN Entertainment and Singapore Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PENN Entertainment and Singapore Telecommunicatio
The main advantage of trading using opposite PENN Entertainment and Singapore Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PENN Entertainment 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.| PENN Entertainment vs. Addus HomeCare | PENN Entertainment vs. LANDSEA GREEN MANAGEMENT | PENN Entertainment vs. Cleanaway Waste Management | PENN Entertainment vs. Haier Smart Home |
| Singapore Telecommunicatio vs. T Mobile | Singapore Telecommunicatio vs. China Mobile Limited | Singapore Telecommunicatio vs. Verizon Communications | Singapore Telecommunicatio vs. ATT 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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