Correlation Between BDO Unibank and Prime Media
Can any of the company-specific risk be diversified away by investing in both BDO Unibank and Prime Media 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 BDO Unibank and Prime Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BDO Unibank and Prime Media Holdings, you can compare the effects of market volatilities on BDO Unibank and Prime Media 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 BDO Unibank with a short position of Prime Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of BDO Unibank and Prime Media.
Diversification Opportunities for BDO Unibank and Prime Media
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BDO and Prime is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding BDO Unibank and Prime Media Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prime Media Holdings and BDO Unibank 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 BDO Unibank are associated (or correlated) with Prime Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prime Media Holdings has no effect on the direction of BDO Unibank i.e., BDO Unibank and Prime Media go up and down completely randomly.
Pair Corralation between BDO Unibank and Prime Media
Assuming the 90 days trading horizon BDO Unibank is expected to generate 0.76 times more return on investment than Prime Media. However, BDO Unibank is 1.31 times less risky than Prime Media. It trades about -0.09 of its potential returns per unit of risk. Prime Media Holdings is currently generating about -0.36 per unit of risk. If you would invest 16,000 in BDO Unibank on August 28, 2024 and sell it today you would lose (830.00) from holding BDO Unibank or give up 5.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BDO Unibank vs. Prime Media Holdings
Performance |
| Timeline |
| BDO Unibank |
| Prime Media Holdings |
BDO Unibank and Prime Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BDO Unibank and Prime Media
The main advantage of trading using opposite BDO Unibank and Prime Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BDO Unibank position performs unexpectedly, Prime Media 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 Prime Media will offset losses from the drop in Prime Media's long position.| BDO Unibank vs. Integrated Micro Electronics | BDO Unibank vs. Top Frontier Investment | BDO Unibank vs. Semirara Mining Corp | BDO Unibank vs. SM Investments Corp |
| Prime Media vs. Allhome Corp | Prime Media vs. Jollibee Foods Corp | Prime Media vs. LFM Properties Corp | Prime Media vs. PXP Energy 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |