Correlation Between InPlay Oil and SAN MIGUEL
Can any of the company-specific risk be diversified away by investing in both InPlay Oil and SAN MIGUEL 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 InPlay Oil and SAN MIGUEL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between InPlay Oil Corp and SAN MIGUEL BREWERY, you can compare the effects of market volatilities on InPlay Oil and SAN MIGUEL 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 InPlay Oil with a short position of SAN MIGUEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of InPlay Oil and SAN MIGUEL.
Diversification Opportunities for InPlay Oil and SAN MIGUEL
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between InPlay and SAN is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding InPlay Oil Corp and SAN MIGUEL BREWERY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAN MIGUEL BREWERY and InPlay Oil 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 InPlay Oil Corp are associated (or correlated) with SAN MIGUEL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAN MIGUEL BREWERY has no effect on the direction of InPlay Oil i.e., InPlay Oil and SAN MIGUEL go up and down completely randomly.
Pair Corralation between InPlay Oil and SAN MIGUEL
Assuming the 90 days trading horizon InPlay Oil Corp is expected to under-perform the SAN MIGUEL. But the stock apears to be less risky and, when comparing its historical volatility, InPlay Oil Corp is 3.05 times less risky than SAN MIGUEL. The stock trades about -0.02 of its potential returns per unit of risk. The SAN MIGUEL BREWERY is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 4.24 in SAN MIGUEL BREWERY on October 18, 2024 and sell it today you would earn a total of 5.26 from holding SAN MIGUEL BREWERY or generate 124.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
InPlay Oil Corp vs. SAN MIGUEL BREWERY
Performance |
| Timeline |
| InPlay Oil Corp |
| SAN MIGUEL BREWERY |
InPlay Oil and SAN MIGUEL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with InPlay Oil and SAN MIGUEL
The main advantage of trading using opposite InPlay Oil and SAN MIGUEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if InPlay Oil position performs unexpectedly, SAN MIGUEL 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 SAN MIGUEL will offset losses from the drop in SAN MIGUEL's long position.| InPlay Oil vs. USWE SPORTS AB | InPlay Oil vs. CDN IMPERIAL BANK | InPlay Oil vs. Yuexiu Transport Infrastructure | InPlay Oil vs. REVO INSURANCE SPA |
| SAN MIGUEL vs. InPlay Oil Corp | SAN MIGUEL vs. AGF Management Limited | SAN MIGUEL vs. Playtech plc | SAN MIGUEL vs. Brockhaus Capital Management |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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