Correlation Between SINGAPORE AIRLINES and MOVIE GAMES
Can any of the company-specific risk be diversified away by investing in both SINGAPORE AIRLINES and MOVIE GAMES 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 AIRLINES and MOVIE GAMES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SINGAPORE AIRLINES and MOVIE GAMES SA, you can compare the effects of market volatilities on SINGAPORE AIRLINES and MOVIE GAMES 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 AIRLINES with a short position of MOVIE GAMES. Check out your portfolio center. Please also check ongoing floating volatility patterns of SINGAPORE AIRLINES and MOVIE GAMES.
Diversification Opportunities for SINGAPORE AIRLINES and MOVIE GAMES
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SINGAPORE and MOVIE is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding SINGAPORE AIRLINES and MOVIE GAMES SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MOVIE GAMES SA and SINGAPORE AIRLINES 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 AIRLINES are associated (or correlated) with MOVIE GAMES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MOVIE GAMES SA has no effect on the direction of SINGAPORE AIRLINES i.e., SINGAPORE AIRLINES and MOVIE GAMES go up and down completely randomly.
Pair Corralation between SINGAPORE AIRLINES and MOVIE GAMES
Assuming the 90 days trading horizon SINGAPORE AIRLINES is expected to generate 2.77 times less return on investment than MOVIE GAMES. But when comparing it to its historical volatility, SINGAPORE AIRLINES is 5.92 times less risky than MOVIE GAMES. It trades about 0.16 of its potential returns per unit of risk. MOVIE GAMES SA is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 374.00 in MOVIE GAMES SA on October 11, 2024 and sell it today you would earn a total of 38.00 from holding MOVIE GAMES SA or generate 10.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SINGAPORE AIRLINES vs. MOVIE GAMES SA
Performance |
| Timeline |
| SINGAPORE AIRLINES |
| MOVIE GAMES SA |
SINGAPORE AIRLINES and MOVIE GAMES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SINGAPORE AIRLINES and MOVIE GAMES
The main advantage of trading using opposite SINGAPORE AIRLINES and MOVIE GAMES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SINGAPORE AIRLINES position performs unexpectedly, MOVIE GAMES 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 MOVIE GAMES will offset losses from the drop in MOVIE GAMES's long position.| SINGAPORE AIRLINES vs. Titan Machinery | SINGAPORE AIRLINES vs. Nufarm Limited | SINGAPORE AIRLINES vs. Endeavour Mining PLC | SINGAPORE AIRLINES vs. WIMFARM SA EO |
| MOVIE GAMES vs. SINGAPORE AIRLINES | MOVIE GAMES vs. Nok Airlines PCL | MOVIE GAMES vs. Commercial Vehicle Group | MOVIE GAMES vs. Motorcar Parts of |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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