Correlation Between Singapore Reinsurance and OPKO HEALTH
Can any of the company-specific risk be diversified away by investing in both Singapore Reinsurance and OPKO HEALTH 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 OPKO HEALTH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Singapore Reinsurance and OPKO HEALTH, you can compare the effects of market volatilities on Singapore Reinsurance and OPKO HEALTH 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 OPKO HEALTH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Singapore Reinsurance and OPKO HEALTH.
Diversification Opportunities for Singapore Reinsurance and OPKO HEALTH
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Singapore and OPKO is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Singapore Reinsurance and OPKO HEALTH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OPKO HEALTH 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 OPKO HEALTH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OPKO HEALTH has no effect on the direction of Singapore Reinsurance i.e., Singapore Reinsurance and OPKO HEALTH go up and down completely randomly.
Pair Corralation between Singapore Reinsurance and OPKO HEALTH
Assuming the 90 days trading horizon Singapore Reinsurance is expected to generate 2.04 times more return on investment than OPKO HEALTH. However, Singapore Reinsurance is 2.04 times more volatile than OPKO HEALTH. It trades about 0.14 of its potential returns per unit of risk. OPKO HEALTH is currently generating about -0.18 per unit of risk. If you would invest 3,480 in Singapore Reinsurance on October 30, 2024 and sell it today you would earn a total of 280.00 from holding Singapore Reinsurance or generate 8.05% 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. OPKO HEALTH
Performance |
| Timeline |
| Singapore Reinsurance |
| OPKO HEALTH |
Singapore Reinsurance and OPKO HEALTH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Singapore Reinsurance and OPKO HEALTH
The main advantage of trading using opposite Singapore Reinsurance and OPKO HEALTH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Singapore Reinsurance position performs unexpectedly, OPKO HEALTH 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 OPKO HEALTH will offset losses from the drop in OPKO HEALTH's long position.| Singapore Reinsurance vs. Singapore Telecommunications Limited | Singapore Reinsurance vs. SOGECLAIR SA INH | Singapore Reinsurance vs. Westinghouse Air Brake | Singapore Reinsurance vs. Pentair plc |
| OPKO HEALTH vs. Nucletron Electronic Aktiengesellschaft | OPKO HEALTH vs. Molson Coors Beverage | OPKO HEALTH vs. Arrow Electronics | OPKO HEALTH vs. ARROW ELECTRONICS |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |