Correlation Between Singapore Reinsurance and LASSONDE INDUSTINC
Can any of the company-specific risk be diversified away by investing in both Singapore Reinsurance and LASSONDE INDUSTINC 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 Singapore Reinsurance and LASSONDE INDUSTINC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Singapore Reinsurance and LASSONDE INDUSTINC A, you can compare the effects of market volatilities on Singapore Reinsurance and LASSONDE INDUSTINC 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 Singapore Reinsurance with a short position of LASSONDE INDUSTINC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Singapore Reinsurance and LASSONDE INDUSTINC.
Diversification Opportunities for Singapore Reinsurance and LASSONDE INDUSTINC
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Singapore and LASSONDE is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Singapore Reinsurance and LASSONDE INDUSTINC A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LASSONDE INDUSTINC and Singapore Reinsurance 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 Singapore Reinsurance are associated (or correlated) with LASSONDE INDUSTINC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LASSONDE INDUSTINC has no effect on the direction of Singapore Reinsurance i.e., Singapore Reinsurance and LASSONDE INDUSTINC go up and down completely randomly.
Pair Corralation between Singapore Reinsurance and LASSONDE INDUSTINC
Assuming the 90 days trading horizon Singapore Reinsurance is expected to generate 1.78 times less return on investment than LASSONDE INDUSTINC. But when comparing it to its historical volatility, Singapore Reinsurance is 1.08 times less risky than LASSONDE INDUSTINC. It trades about 0.04 of its potential returns per unit of risk. LASSONDE INDUSTINC A is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 6,713 in LASSONDE INDUSTINC A on September 12, 2024 and sell it today you would earn a total of 4,887 from holding LASSONDE INDUSTINC A or generate 72.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Singapore Reinsurance vs. LASSONDE INDUSTINC A
Performance |
| Timeline |
| Singapore Reinsurance |
| LASSONDE INDUSTINC |
Singapore Reinsurance and LASSONDE INDUSTINC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Singapore Reinsurance and LASSONDE INDUSTINC
The main advantage of trading using opposite Singapore Reinsurance and LASSONDE INDUSTINC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Singapore Reinsurance position performs unexpectedly, LASSONDE INDUSTINC 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 LASSONDE INDUSTINC will offset losses from the drop in LASSONDE INDUSTINC's long position.| Singapore Reinsurance vs. Apple Inc | Singapore Reinsurance vs. Apple Inc | Singapore Reinsurance vs. Apple Inc | Singapore Reinsurance vs. Apple Inc |
| LASSONDE INDUSTINC vs. GameStop Corp | LASSONDE INDUSTINC vs. Boyd Gaming | LASSONDE INDUSTINC vs. OURGAME INTHOLDL 00005 | LASSONDE INDUSTINC vs. Scientific Games |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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