Correlation Between Singapore Exchange and Deutsche Börse
Can any of the company-specific risk be diversified away by investing in both Singapore Exchange and Deutsche Börse 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 Exchange and Deutsche Börse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Singapore Exchange Limited and Deutsche Brse AG, you can compare the effects of market volatilities on Singapore Exchange and Deutsche Börse 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 Exchange with a short position of Deutsche Börse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Singapore Exchange and Deutsche Börse.
Diversification Opportunities for Singapore Exchange and Deutsche Börse
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Singapore and Deutsche is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Singapore Exchange Limited and Deutsche Brse AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Brse AG and Singapore Exchange 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 Exchange Limited are associated (or correlated) with Deutsche Börse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Brse AG has no effect on the direction of Singapore Exchange i.e., Singapore Exchange and Deutsche Börse go up and down completely randomly.
Pair Corralation between Singapore Exchange and Deutsche Börse
Assuming the 90 days horizon Singapore Exchange Limited is expected to generate 0.88 times more return on investment than Deutsche Börse. However, Singapore Exchange Limited is 1.14 times less risky than Deutsche Börse. It trades about 0.26 of its potential returns per unit of risk. Deutsche Brse AG is currently generating about 0.0 per unit of risk. If you would invest 851.00 in Singapore Exchange Limited on August 31, 2024 and sell it today you would earn a total of 90.00 from holding Singapore Exchange Limited or generate 10.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Singapore Exchange Limited vs. Deutsche Brse AG
Performance |
| Timeline |
| Singapore Exchange |
| Deutsche Brse AG |
Singapore Exchange and Deutsche Börse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Singapore Exchange and Deutsche Börse
The main advantage of trading using opposite Singapore Exchange and Deutsche Börse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Singapore Exchange position performs unexpectedly, Deutsche Börse 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 Deutsche Börse will offset losses from the drop in Deutsche Börse's long position.| Singapore Exchange vs. Hong Kong Exchanges | Singapore Exchange vs. Singapore Exchange Ltd | Singapore Exchange vs. Deutsche Brse AG | Singapore Exchange vs. London Stock Exchange |
| Deutsche Börse vs. Singapore Exchange Limited | Deutsche Börse vs. London Stock Exchange | Deutsche Börse vs. London Stock Exchange | Deutsche Börse vs. Hong Kong Exchanges |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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