Correlation Between SINGAPORE AIRLINES and NEXA RESOURCES
Can any of the company-specific risk be diversified away by investing in both SINGAPORE AIRLINES and NEXA RESOURCES 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 NEXA RESOURCES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SINGAPORE AIRLINES and NEXA RESOURCES SA, you can compare the effects of market volatilities on SINGAPORE AIRLINES and NEXA RESOURCES 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 NEXA RESOURCES. Check out your portfolio center. Please also check ongoing floating volatility patterns of SINGAPORE AIRLINES and NEXA RESOURCES.
Diversification Opportunities for SINGAPORE AIRLINES and NEXA RESOURCES
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between SINGAPORE and NEXA is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding SINGAPORE AIRLINES and NEXA RESOURCES SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEXA RESOURCES 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 NEXA RESOURCES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEXA RESOURCES SA has no effect on the direction of SINGAPORE AIRLINES i.e., SINGAPORE AIRLINES and NEXA RESOURCES go up and down completely randomly.
Pair Corralation between SINGAPORE AIRLINES and NEXA RESOURCES
Assuming the 90 days trading horizon SINGAPORE AIRLINES is expected to generate 0.61 times more return on investment than NEXA RESOURCES. However, SINGAPORE AIRLINES is 1.64 times less risky than NEXA RESOURCES. It trades about 0.04 of its potential returns per unit of risk. NEXA RESOURCES SA is currently generating about 0.01 per unit of risk. If you would invest 436.00 in SINGAPORE AIRLINES on August 31, 2024 and sell it today you would earn a total of 4.00 from holding SINGAPORE AIRLINES or generate 0.92% 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. NEXA RESOURCES SA
Performance |
| Timeline |
| SINGAPORE AIRLINES |
| NEXA RESOURCES SA |
SINGAPORE AIRLINES and NEXA RESOURCES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SINGAPORE AIRLINES and NEXA RESOURCES
The main advantage of trading using opposite SINGAPORE AIRLINES and NEXA RESOURCES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SINGAPORE AIRLINES position performs unexpectedly, NEXA RESOURCES 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 NEXA RESOURCES will offset losses from the drop in NEXA RESOURCES's long position.| SINGAPORE AIRLINES vs. Fair Isaac Corp | SINGAPORE AIRLINES vs. Air New Zealand | SINGAPORE AIRLINES vs. NTG Nordic Transport | SINGAPORE AIRLINES vs. Texas Roadhouse |
| NEXA RESOURCES vs. Computer And Technologies | NEXA RESOURCES vs. ARDAGH METAL PACDL 0001 | NEXA RESOURCES vs. Check Point Software | NEXA RESOURCES vs. PKSHA TECHNOLOGY 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |