Correlation Between SINGAPORE AIRLINES and Astral Foods
Can any of the company-specific risk be diversified away by investing in both SINGAPORE AIRLINES and Astral Foods 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 Astral Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SINGAPORE AIRLINES and Astral Foods Limited, you can compare the effects of market volatilities on SINGAPORE AIRLINES and Astral Foods 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 Astral Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of SINGAPORE AIRLINES and Astral Foods.
Diversification Opportunities for SINGAPORE AIRLINES and Astral Foods
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SINGAPORE and Astral is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding SINGAPORE AIRLINES and Astral Foods Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astral Foods Limited 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 Astral Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astral Foods Limited has no effect on the direction of SINGAPORE AIRLINES i.e., SINGAPORE AIRLINES and Astral Foods go up and down completely randomly.
Pair Corralation between SINGAPORE AIRLINES and Astral Foods
Assuming the 90 days trading horizon SINGAPORE AIRLINES is expected to generate 0.41 times more return on investment than Astral Foods. However, SINGAPORE AIRLINES is 2.42 times less risky than Astral Foods. It trades about 0.0 of its potential returns per unit of risk. Astral Foods Limited is currently generating about -0.17 per unit of risk. If you would invest 454.00 in SINGAPORE AIRLINES on October 11, 2024 and sell it today you would earn a total of 0.00 from holding SINGAPORE AIRLINES or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SINGAPORE AIRLINES vs. Astral Foods Limited
Performance |
| Timeline |
| SINGAPORE AIRLINES |
| Astral Foods Limited |
SINGAPORE AIRLINES and Astral Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SINGAPORE AIRLINES and Astral Foods
The main advantage of trading using opposite SINGAPORE AIRLINES and Astral Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SINGAPORE AIRLINES position performs unexpectedly, Astral Foods 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 Astral Foods will offset losses from the drop in Astral Foods' long position.| SINGAPORE AIRLINES vs. Titan Machinery | SINGAPORE AIRLINES vs. Nufarm Limited | SINGAPORE AIRLINES vs. Endeavour Mining PLC | SINGAPORE AIRLINES vs. WIMFARM SA EO |
| Astral Foods vs. BORR DRILLING NEW | Astral Foods vs. Virtu Financial | Astral Foods vs. SOUTHWEST AIRLINES | Astral Foods vs. Synovus Financial Corp |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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