Correlation Between SINGAPORE AIRLINES and SBA Communications
Can any of the company-specific risk be diversified away by investing in both SINGAPORE AIRLINES and SBA Communications 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 SBA Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SINGAPORE AIRLINES and SBA Communications Corp, you can compare the effects of market volatilities on SINGAPORE AIRLINES and SBA Communications 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 SBA Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of SINGAPORE AIRLINES and SBA Communications.
Diversification Opportunities for SINGAPORE AIRLINES and SBA Communications
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SINGAPORE and SBA is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding SINGAPORE AIRLINES and SBA Communications Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SBA Communications Corp 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 SBA Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SBA Communications Corp has no effect on the direction of SINGAPORE AIRLINES i.e., SINGAPORE AIRLINES and SBA Communications go up and down completely randomly.
Pair Corralation between SINGAPORE AIRLINES and SBA Communications
Assuming the 90 days trading horizon SINGAPORE AIRLINES is expected to generate 1.92 times less return on investment than SBA Communications. But when comparing it to its historical volatility, SINGAPORE AIRLINES is 1.22 times less risky than SBA Communications. It trades about 0.04 of its potential returns per unit of risk. SBA Communications Corp is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 20,323 in SBA Communications Corp on September 2, 2024 and sell it today you would earn a total of 1,257 from holding SBA Communications Corp or generate 6.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SINGAPORE AIRLINES vs. SBA Communications Corp
Performance |
| Timeline |
| SINGAPORE AIRLINES |
| SBA Communications Corp |
SINGAPORE AIRLINES and SBA Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SINGAPORE AIRLINES and SBA Communications
The main advantage of trading using opposite SINGAPORE AIRLINES and SBA Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SINGAPORE AIRLINES position performs unexpectedly, SBA Communications 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 SBA Communications will offset losses from the drop in SBA Communications' long position.| SINGAPORE AIRLINES vs. SIVERS SEMICONDUCTORS AB | SINGAPORE AIRLINES vs. Darden Restaurants | SINGAPORE AIRLINES vs. Reliance Steel Aluminum | SINGAPORE AIRLINES vs. Q2M Managementberatung AG |
| SBA Communications vs. Apple Inc | SBA Communications vs. Apple Inc | SBA Communications vs. Apple Inc | SBA Communications vs. Apple 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |