Correlation Between Singapore Reinsurance and Ping An
Can any of the company-specific risk be diversified away by investing in both Singapore Reinsurance and Ping An 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 Ping An into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Singapore Reinsurance and Ping An Insurance, you can compare the effects of market volatilities on Singapore Reinsurance and Ping An 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 Ping An. Check out your portfolio center. Please also check ongoing floating volatility patterns of Singapore Reinsurance and Ping An.
Diversification Opportunities for Singapore Reinsurance and Ping An
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Singapore and Ping is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Singapore Reinsurance and Ping An Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ping An Insurance 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 Ping An. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ping An Insurance has no effect on the direction of Singapore Reinsurance i.e., Singapore Reinsurance and Ping An go up and down completely randomly.
Pair Corralation between Singapore Reinsurance and Ping An
Assuming the 90 days trading horizon Singapore Reinsurance is expected to generate 5.09 times less return on investment than Ping An. But when comparing it to its historical volatility, Singapore Reinsurance is 1.48 times less risky than Ping An. It trades about 0.03 of its potential returns per unit of risk. Ping An Insurance is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 558.00 in Ping An Insurance on September 15, 2024 and sell it today you would earn a total of 20.00 from holding Ping An Insurance or generate 3.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Singapore Reinsurance vs. Ping An Insurance
Performance |
| Timeline |
| Singapore Reinsurance |
| Ping An Insurance |
Singapore Reinsurance and Ping An Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Singapore Reinsurance and Ping An
The main advantage of trading using opposite Singapore Reinsurance and Ping An positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Singapore Reinsurance position performs unexpectedly, Ping An 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 Ping An will offset losses from the drop in Ping An's long position.| Singapore Reinsurance vs. Apple Inc | Singapore Reinsurance vs. Apple Inc | Singapore Reinsurance vs. Apple Inc | Singapore Reinsurance vs. Apple Inc |
| Ping An vs. American Public Education | Ping An vs. Zoom Video Communications | Ping An vs. Xinhua Winshare Publishing | Ping An vs. MCEWEN MINING 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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