Correlation Between Singapore Telecommunicatio and BCE
Can any of the company-specific risk be diversified away by investing in both Singapore Telecommunicatio and BCE 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 BCE 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 BCE Inc, you can compare the effects of market volatilities on Singapore Telecommunicatio and BCE 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 BCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Singapore Telecommunicatio and BCE.
Diversification Opportunities for Singapore Telecommunicatio and BCE
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Singapore and BCE is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Singapore Telecommunications L and BCE Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BCE Inc 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 BCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BCE Inc has no effect on the direction of Singapore Telecommunicatio i.e., Singapore Telecommunicatio and BCE go up and down completely randomly.
Pair Corralation between Singapore Telecommunicatio and BCE
Assuming the 90 days horizon Singapore Telecommunications Limited is expected to generate 0.9 times more return on investment than BCE. However, Singapore Telecommunications Limited is 1.11 times less risky than BCE. It trades about 0.22 of its potential returns per unit of risk. BCE Inc is currently generating about -0.04 per unit of risk. If you would invest 218.00 in Singapore Telecommunications Limited on November 29, 2024 and sell it today you would earn a total of 20.00 from holding Singapore Telecommunications Limited or generate 9.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Singapore Telecommunications L vs. BCE Inc
Performance |
| Timeline |
| Singapore Telecommunicatio |
| BCE Inc |
Singapore Telecommunicatio and BCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Singapore Telecommunicatio and BCE
The main advantage of trading using opposite Singapore Telecommunicatio and BCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Singapore Telecommunicatio position performs unexpectedly, BCE 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 BCE will offset losses from the drop in BCE's long position.| Singapore Telecommunicatio vs. Airtel Africa Plc | Singapore Telecommunicatio vs. KDDI Corp | Singapore Telecommunicatio vs. Amrica Mvil, SAB | Singapore Telecommunicatio vs. Turk Telekomunikasyon AS |
| BCE vs. Rogers Communications | BCE vs. America Movil SAB | BCE vs. Telus Corp | BCE vs. Telefonica Brasil SA |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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