Correlation Between Singapore ReinsuranceLimit and STHREE PLC
Can any of the company-specific risk be diversified away by investing in both Singapore ReinsuranceLimit and STHREE 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 ReinsuranceLimit and STHREE 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 STHREE PLC LS, you can compare the effects of market volatilities on Singapore ReinsuranceLimit and STHREE 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 ReinsuranceLimit with a short position of STHREE PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Singapore ReinsuranceLimit and STHREE PLC.
Diversification Opportunities for Singapore ReinsuranceLimit and STHREE PLC
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Singapore and STHREE is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Singapore Reinsurance and STHREE PLC LS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STHREE PLC LS and Singapore ReinsuranceLimit 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 STHREE PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STHREE PLC LS has no effect on the direction of Singapore ReinsuranceLimit i.e., Singapore ReinsuranceLimit and STHREE PLC go up and down completely randomly.
Pair Corralation between Singapore ReinsuranceLimit and STHREE PLC
Assuming the 90 days trading horizon Singapore Reinsurance is expected to generate 1.55 times more return on investment than STHREE PLC. However, Singapore ReinsuranceLimit is 1.55 times more volatile than STHREE PLC LS. It trades about 0.09 of its potential returns per unit of risk. STHREE PLC LS is currently generating about -0.08 per unit of risk. If you would invest 3,120 in Singapore Reinsurance on September 4, 2024 and sell it today you would earn a total of 440.00 from holding Singapore Reinsurance or generate 14.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.46% |
| Values | Daily Returns |
Singapore Reinsurance vs. STHREE PLC LS
Performance |
| Timeline |
| Singapore ReinsuranceLimit |
| STHREE PLC LS |
Singapore ReinsuranceLimit and STHREE PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Singapore ReinsuranceLimit and STHREE PLC
The main advantage of trading using opposite Singapore ReinsuranceLimit and STHREE PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Singapore ReinsuranceLimit position performs unexpectedly, STHREE 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 STHREE PLC will offset losses from the drop in STHREE PLC's long position.| Singapore ReinsuranceLimit vs. TOTAL GABON | Singapore ReinsuranceLimit vs. Walgreens Boots Alliance | Singapore ReinsuranceLimit vs. Peak Resources Limited |
| STHREE PLC vs. Singapore Reinsurance | STHREE PLC vs. SBI Insurance Group | STHREE PLC vs. Goosehead Insurance | STHREE PLC vs. Sunny Optical Technology |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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