Correlation Between Targa Resources and Singapore Airlines
Can any of the company-specific risk be diversified away by investing in both Targa Resources 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 Targa Resources and Singapore Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Targa Resources and Singapore Airlines, you can compare the effects of market volatilities on Targa Resources 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 Targa Resources with a short position of Singapore Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Targa Resources and Singapore Airlines.
Diversification Opportunities for Targa Resources and Singapore Airlines
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Targa and Singapore is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Targa Resources and Singapore Airlines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Singapore Airlines and Targa Resources 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 Targa Resources 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 Targa Resources i.e., Targa Resources and Singapore Airlines go up and down completely randomly.
Pair Corralation between Targa Resources and Singapore Airlines
Given the investment horizon of 90 days Targa Resources is expected to generate 2.41 times more return on investment than Singapore Airlines. However, Targa Resources is 2.41 times more volatile than Singapore Airlines. It trades about 0.18 of its potential returns per unit of risk. Singapore Airlines is currently generating about -0.09 per unit of risk. If you would invest 18,306 in Targa Resources on November 3, 2024 and sell it today you would earn a total of 1,374 from holding Targa Resources or generate 7.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Targa Resources vs. Singapore Airlines
Performance |
| Timeline |
| Targa Resources |
| Singapore Airlines |
Targa Resources and Singapore Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Targa Resources and Singapore Airlines
The main advantage of trading using opposite Targa Resources and Singapore Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Targa Resources 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' long position.| Targa Resources vs. Plains GP Holdings | Targa Resources vs. Western Midstream Partners | Targa Resources vs. EnLink Midstream LLC | Targa Resources vs. Plains All American |
| Singapore Airlines vs. Cathay Pacific Airways | Singapore Airlines vs. Qantas Airways Ltd | Singapore Airlines vs. International Consolidated Airlines | Singapore Airlines vs. Singapore Airlines |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |