Correlation Between AC Energy and Manila Mining
Can any of the company-specific risk be diversified away by investing in both AC Energy and Manila Mining 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 AC Energy and Manila Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AC Energy Philippines and Manila Mining Corp, you can compare the effects of market volatilities on AC Energy and Manila Mining 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 AC Energy with a short position of Manila Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of AC Energy and Manila Mining.
Diversification Opportunities for AC Energy and Manila Mining
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ACEN and Manila is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding AC Energy Philippines and Manila Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manila Mining Corp and AC Energy 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 AC Energy Philippines are associated (or correlated) with Manila Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manila Mining Corp has no effect on the direction of AC Energy i.e., AC Energy and Manila Mining go up and down completely randomly.
Pair Corralation between AC Energy and Manila Mining
Assuming the 90 days trading horizon AC Energy Philippines is expected to generate 0.52 times more return on investment than Manila Mining. However, AC Energy Philippines is 1.91 times less risky than Manila Mining. It trades about -0.03 of its potential returns per unit of risk. Manila Mining Corp is currently generating about -0.11 per unit of risk. If you would invest 530.00 in AC Energy Philippines on September 12, 2024 and sell it today you would lose (160.00) from holding AC Energy Philippines or give up 30.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 47.66% |
| Values | Daily Returns |
AC Energy Philippines vs. Manila Mining Corp
Performance |
| Timeline |
| AC Energy Philippines |
| Manila Mining Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
AC Energy and Manila Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AC Energy and Manila Mining
The main advantage of trading using opposite AC Energy and Manila Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AC Energy position performs unexpectedly, Manila Mining 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 Manila Mining will offset losses from the drop in Manila Mining's long position.| AC Energy vs. Aboitiz Power Corp | AC Energy vs. GT Capital Holdings | AC Energy vs. Allhome Corp | AC Energy vs. Jollibee Foods Corp |
| Manila Mining vs. Nickel Asia Corp | Manila Mining vs. Atok Big Wedge | Manila Mining vs. Philex Mining Corp | Manila Mining vs. Atlas Consolidated Mining |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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