Correlation Between X Fab and Singapore Airlines
Can any of the company-specific risk be diversified away by investing in both X Fab 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 X Fab and Singapore Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between X Fab Silicon and Singapore Airlines Limited, you can compare the effects of market volatilities on X Fab 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 X Fab with a short position of Singapore Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of X Fab and Singapore Airlines.
Diversification Opportunities for X Fab and Singapore Airlines
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between XFB and Singapore is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding X Fab Silicon and Singapore Airlines Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Singapore Airlines and X Fab 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 X Fab Silicon 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 X Fab i.e., X Fab and Singapore Airlines go up and down completely randomly.
Pair Corralation between X Fab and Singapore Airlines
Assuming the 90 days horizon X Fab Silicon is expected to under-perform the Singapore Airlines. In addition to that, X Fab is 1.74 times more volatile than Singapore Airlines Limited. It trades about -0.03 of its total potential returns per unit of risk. Singapore Airlines Limited is currently generating about 0.05 per unit of volatility. If you would invest 320.00 in Singapore Airlines Limited on September 3, 2024 and sell it today you would earn a total of 122.00 from holding Singapore Airlines Limited or generate 38.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
X Fab Silicon vs. Singapore Airlines Limited
Performance |
| Timeline |
| X Fab Silicon |
| Singapore Airlines |
X Fab and Singapore Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with X Fab and Singapore Airlines
The main advantage of trading using opposite X Fab and Singapore Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if X Fab 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.| X Fab vs. Singapore Airlines Limited | X Fab vs. FANDIFI TECHNOLOGY P | X Fab vs. Microchip Technology Incorporated | X Fab vs. AECOM TECHNOLOGY |
| Singapore Airlines vs. Delta Air Lines | Singapore Airlines vs. AIR CHINA LTD | Singapore Airlines vs. RYANAIR HLDGS ADR | Singapore Airlines vs. Southwest Airlines Co |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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