Correlation Between Alstria Office and SAN MIGUEL
Can any of the company-specific risk be diversified away by investing in both Alstria Office 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 Alstria Office and SAN MIGUEL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between alstria office REIT AG and SAN MIGUEL BREWERY, you can compare the effects of market volatilities on Alstria Office 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 Alstria Office with a short position of SAN MIGUEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alstria Office and SAN MIGUEL.
Diversification Opportunities for Alstria Office and SAN MIGUEL
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Alstria and SAN is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding alstria office REIT AG 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 Alstria Office 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 alstria office REIT AG 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 Alstria Office i.e., Alstria Office and SAN MIGUEL go up and down completely randomly.
Pair Corralation between Alstria Office and SAN MIGUEL
Assuming the 90 days horizon alstria office REIT AG is expected to under-perform the SAN MIGUEL. In addition to that, Alstria Office is 11.92 times more volatile than SAN MIGUEL BREWERY. It trades about -0.2 of its total potential returns per unit of risk. SAN MIGUEL BREWERY is currently generating about -0.24 per unit of volatility. If you would invest 10.00 in SAN MIGUEL BREWERY on October 12, 2024 and sell it today you would lose (0.25) from holding SAN MIGUEL BREWERY or give up 2.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
alstria office REIT AG vs. SAN MIGUEL BREWERY
Performance |
| Timeline |
| alstria office REIT |
| SAN MIGUEL BREWERY |
Alstria Office and SAN MIGUEL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alstria Office and SAN MIGUEL
The main advantage of trading using opposite Alstria Office and SAN MIGUEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alstria Office 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.| Alstria Office vs. Canadian Utilities Limited | Alstria Office vs. Algonquin Power Utilities | Alstria Office vs. UNITED RENTALS | Alstria Office vs. United Breweries Co |
| SAN MIGUEL vs. AOI Electronics Co | SAN MIGUEL vs. alstria office REIT AG | SAN MIGUEL vs. 24SEVENOFFICE GROUP AB | SAN MIGUEL vs. Methode Electronics |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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