Correlation Between Singapore Telecommunicatio and Pure Storage
Can any of the company-specific risk be diversified away by investing in both Singapore Telecommunicatio and Pure Storage 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 Telecommunicatio and Pure Storage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Singapore Telecommunications Limited and Pure Storage, you can compare the effects of market volatilities on Singapore Telecommunicatio and Pure Storage 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 Telecommunicatio with a short position of Pure Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Singapore Telecommunicatio and Pure Storage.
Diversification Opportunities for Singapore Telecommunicatio and Pure Storage
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Singapore and Pure is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Singapore Telecommunications L and Pure Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pure Storage and Singapore Telecommunicatio 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 Telecommunications Limited are associated (or correlated) with Pure Storage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pure Storage has no effect on the direction of Singapore Telecommunicatio i.e., Singapore Telecommunicatio and Pure Storage go up and down completely randomly.
Pair Corralation between Singapore Telecommunicatio and Pure Storage
Assuming the 90 days trading horizon Singapore Telecommunicatio is expected to generate 1.4 times less return on investment than Pure Storage. But when comparing it to its historical volatility, Singapore Telecommunications Limited is 1.89 times less risky than Pure Storage. It trades about 0.06 of its potential returns per unit of risk. Pure Storage is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 3,426 in Pure Storage on August 26, 2024 and sell it today you would earn a total of 1,354 from holding Pure Storage or generate 39.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Singapore Telecommunications L vs. Pure Storage
Performance |
| Timeline |
| Singapore Telecommunicatio |
| Pure Storage |
Singapore Telecommunicatio and Pure Storage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Singapore Telecommunicatio and Pure Storage
The main advantage of trading using opposite Singapore Telecommunicatio and Pure Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Singapore Telecommunicatio position performs unexpectedly, Pure Storage 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 Pure Storage will offset losses from the drop in Pure Storage's long position.| Singapore Telecommunicatio vs. SHIN ETSU CHEMICAL | Singapore Telecommunicatio vs. Public Storage | Singapore Telecommunicatio vs. Eastman Chemical | Singapore Telecommunicatio vs. KINGBOARD CHEMICAL |
| Pure Storage vs. Taiwan Semiconductor Manufacturing | Pure Storage vs. FORWARD AIR P | Pure Storage vs. Elmos Semiconductor SE | Pure Storage vs. NXP Semiconductors NV |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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