Correlation Between Singapore Reinsurance and Halma Plc
Can any of the company-specific risk be diversified away by investing in both Singapore Reinsurance and Halma Plc 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 Halma Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Singapore Reinsurance and Halma plc, you can compare the effects of market volatilities on Singapore Reinsurance and Halma Plc 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 Halma Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Singapore Reinsurance and Halma Plc.
Diversification Opportunities for Singapore Reinsurance and Halma Plc
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Singapore and Halma is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Singapore Reinsurance and Halma plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Halma plc 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 Halma Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Halma plc has no effect on the direction of Singapore Reinsurance i.e., Singapore Reinsurance and Halma Plc go up and down completely randomly.
Pair Corralation between Singapore Reinsurance and Halma Plc
Assuming the 90 days trading horizon Singapore Reinsurance is expected to generate 0.97 times more return on investment than Halma Plc. However, Singapore Reinsurance is 1.03 times less risky than Halma Plc. It trades about 0.21 of its potential returns per unit of risk. Halma plc is currently generating about -0.1 per unit of risk. If you would invest 3,460 in Singapore Reinsurance on October 17, 2024 and sell it today you would earn a total of 200.00 from holding Singapore Reinsurance or generate 5.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 94.44% |
| Values | Daily Returns |
Singapore Reinsurance vs. Halma plc
Performance |
| Timeline |
| Singapore Reinsurance |
| Halma plc |
Singapore Reinsurance and Halma Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Singapore Reinsurance and Halma Plc
The main advantage of trading using opposite Singapore Reinsurance and Halma Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Singapore Reinsurance position performs unexpectedly, Halma Plc 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 Halma Plc will offset losses from the drop in Halma Plc's long position.| Singapore Reinsurance vs. Summit Materials | Singapore Reinsurance vs. Penn National Gaming | Singapore Reinsurance vs. Media and Games | Singapore Reinsurance vs. OURGAME INTHOLDL 00005 |
| Halma Plc vs. NH HOTEL GROUP | Halma Plc vs. Park Hotels Resorts | Halma Plc vs. Singapore Reinsurance | Halma Plc vs. The Hanover Insurance |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |