Correlation Between Asia United and Ayala Land
Can any of the company-specific risk be diversified away by investing in both Asia United and Ayala Land 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 Asia United and Ayala Land into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asia United Bank and Ayala Land, you can compare the effects of market volatilities on Asia United and Ayala Land 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 Asia United with a short position of Ayala Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asia United and Ayala Land.
Diversification Opportunities for Asia United and Ayala Land
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Asia and Ayala is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Asia United Bank and Ayala Land in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ayala Land and Asia United 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 Asia United Bank are associated (or correlated) with Ayala Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ayala Land has no effect on the direction of Asia United i.e., Asia United and Ayala Land go up and down completely randomly.
Pair Corralation between Asia United and Ayala Land
Assuming the 90 days trading horizon Asia United Bank is expected to generate 0.5 times more return on investment than Ayala Land. However, Asia United Bank is 1.98 times less risky than Ayala Land. It trades about 0.21 of its potential returns per unit of risk. Ayala Land is currently generating about -0.28 per unit of risk. If you would invest 6,000 in Asia United Bank on September 13, 2024 and sell it today you would earn a total of 250.00 from holding Asia United Bank or generate 4.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asia United Bank vs. Ayala Land
Performance |
| Timeline |
| Asia United Bank |
| Ayala Land |
Asia United and Ayala Land Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asia United and Ayala Land
The main advantage of trading using opposite Asia United and Ayala Land positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asia United position performs unexpectedly, Ayala Land 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 Ayala Land will offset losses from the drop in Ayala Land's long position.| Asia United vs. National Reinsurance | Asia United vs. Prime Media Holdings | Asia United vs. Crown Asia Chemicals | Asia United vs. Pacificonline Systems |
| Ayala Land vs. Robinsons Land Corp | Ayala Land vs. Filinvest Development Coproration | Ayala Land vs. DoubleDragon Properties Corp | Ayala Land vs. DoubleDragon Properties Corp |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |