Correlation Between T MOBILE and SINGAPORE AIRLINES
Can any of the company-specific risk be diversified away by investing in both T MOBILE and SINGAPORE AIRLINES 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 T MOBILE and SINGAPORE AIRLINES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between T MOBILE INCDL 00001 and SINGAPORE AIRLINES, you can compare the effects of market volatilities on T MOBILE and SINGAPORE AIRLINES 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 T MOBILE with a short position of SINGAPORE AIRLINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of T MOBILE and SINGAPORE AIRLINES.
Diversification Opportunities for T MOBILE and SINGAPORE AIRLINES
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between TM5 and SINGAPORE is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding T MOBILE INCDL 00001 and SINGAPORE AIRLINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SINGAPORE AIRLINES and T MOBILE 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 T MOBILE INCDL 00001 are associated (or correlated) with SINGAPORE AIRLINES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SINGAPORE AIRLINES has no effect on the direction of T MOBILE i.e., T MOBILE and SINGAPORE AIRLINES go up and down completely randomly.
Pair Corralation between T MOBILE and SINGAPORE AIRLINES
Assuming the 90 days trading horizon T MOBILE is expected to generate 18.16 times less return on investment than SINGAPORE AIRLINES. In addition to that, T MOBILE is 1.39 times more volatile than SINGAPORE AIRLINES. It trades about 0.01 of its total potential returns per unit of risk. SINGAPORE AIRLINES is currently generating about 0.3 per unit of volatility. If you would invest 428.00 in SINGAPORE AIRLINES on September 12, 2024 and sell it today you would earn a total of 26.00 from holding SINGAPORE AIRLINES or generate 6.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
T MOBILE INCDL 00001 vs. SINGAPORE AIRLINES
Performance |
| Timeline |
| T MOBILE INCDL |
| SINGAPORE AIRLINES |
T MOBILE and SINGAPORE AIRLINES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with T MOBILE and SINGAPORE AIRLINES
The main advantage of trading using opposite T MOBILE and SINGAPORE AIRLINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if T MOBILE position performs unexpectedly, SINGAPORE AIRLINES 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 SINGAPORE AIRLINES will offset losses from the drop in SINGAPORE AIRLINES's long position.| T MOBILE vs. VARIOUS EATERIES LS | T MOBILE vs. Hemisphere Energy Corp | T MOBILE vs. Darden Restaurants | T MOBILE vs. Ribbon Communications |
| SINGAPORE AIRLINES vs. Apple Inc | SINGAPORE AIRLINES vs. Apple Inc | SINGAPORE AIRLINES vs. Apple Inc | SINGAPORE AIRLINES vs. Apple 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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