Correlation Between Singapore Telecommunicatio and Pampa Energía
Can any of the company-specific risk be diversified away by investing in both Singapore Telecommunicatio and Pampa Energía 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 Pampa Energía 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 Pampa Energa SA, you can compare the effects of market volatilities on Singapore Telecommunicatio and Pampa Energía 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 Pampa Energía. Check out your portfolio center. Please also check ongoing floating volatility patterns of Singapore Telecommunicatio and Pampa Energía.
Diversification Opportunities for Singapore Telecommunicatio and Pampa Energía
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Singapore and Pampa is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Singapore Telecommunications L and Pampa Energa SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pampa Energa SA 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 Pampa Energía. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pampa Energa SA has no effect on the direction of Singapore Telecommunicatio i.e., Singapore Telecommunicatio and Pampa Energía go up and down completely randomly.
Pair Corralation between Singapore Telecommunicatio and Pampa Energía
Assuming the 90 days trading horizon Singapore Telecommunicatio is expected to generate 10.31 times less return on investment than Pampa Energía. But when comparing it to its historical volatility, Singapore Telecommunications Limited is 1.19 times less risky than Pampa Energía. It trades about 0.08 of its potential returns per unit of risk. Pampa Energa SA is currently generating about 0.67 of returns per unit of risk over similar time horizon. If you would invest 6,050 in Pampa Energa SA on September 3, 2024 and sell it today you would earn a total of 2,250 from holding Pampa Energa SA or generate 37.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Singapore Telecommunications L vs. Pampa Energa SA
Performance |
| Timeline |
| Singapore Telecommunicatio |
| Pampa Energa SA |
Singapore Telecommunicatio and Pampa Energía Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Singapore Telecommunicatio and Pampa Energía
The main advantage of trading using opposite Singapore Telecommunicatio and Pampa Energía positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Singapore Telecommunicatio position performs unexpectedly, Pampa Energía 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 Pampa Energía will offset losses from the drop in Pampa Energía's long position.| Singapore Telecommunicatio vs. T Mobile | Singapore Telecommunicatio vs. China Mobile Limited | Singapore Telecommunicatio vs. ATT Inc | Singapore Telecommunicatio vs. Nippon Telegraph and |
| Pampa Energía vs. CENTRICA ADR NEW | Pampa Energía vs. Superior Plus Corp | Pampa Energía vs. NMI Holdings | Pampa Energía vs. Origin Agritech |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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