Correlation Between Berjaya Philippines and Manila Mining
Can any of the company-specific risk be diversified away by investing in both Berjaya Philippines 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 Berjaya Philippines and Manila Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Berjaya Philippines and Manila Mining Corp, you can compare the effects of market volatilities on Berjaya Philippines 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 Berjaya Philippines with a short position of Manila Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Berjaya Philippines and Manila Mining.
Diversification Opportunities for Berjaya Philippines and Manila Mining
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Berjaya and Manila is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Berjaya 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 Berjaya Philippines 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 Berjaya 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 Berjaya Philippines i.e., Berjaya Philippines and Manila Mining go up and down completely randomly.
Pair Corralation between Berjaya Philippines and Manila Mining
Assuming the 90 days trading horizon Berjaya Philippines is expected to generate 1.54 times more return on investment than Manila Mining. However, Berjaya Philippines is 1.54 times more volatile than Manila Mining Corp. It trades about -0.11 of its potential returns per unit of risk. Manila Mining Corp is currently generating about -0.41 per unit of risk. If you would invest 900.00 in Berjaya Philippines on October 9, 2024 and sell it today you would lose (82.00) from holding Berjaya Philippines or give up 9.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 54.55% |
| Values | Daily Returns |
Berjaya Philippines vs. Manila Mining Corp
Performance |
| Timeline |
| Berjaya Philippines |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Manila Mining Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Berjaya Philippines and Manila Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Berjaya Philippines and Manila Mining
The main advantage of trading using opposite Berjaya Philippines and Manila Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Berjaya Philippines 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.| Berjaya Philippines vs. Jollibee Foods Corp | Berjaya Philippines vs. Figaro Coffee Group | Berjaya Philippines vs. Pacificonline Systems | Berjaya Philippines vs. Allhome Corp |
| Manila Mining vs. Philippine Savings Bank | Manila Mining vs. Apex Mining Co | Manila Mining vs. STI Education Systems | Manila Mining vs. Top Frontier Investment |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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