Correlation Between BDO Unibank and Philex Mining
Can any of the company-specific risk be diversified away by investing in both BDO Unibank and Philex 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 BDO Unibank and Philex Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BDO Unibank and Philex Mining Corp, you can compare the effects of market volatilities on BDO Unibank and Philex 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 BDO Unibank with a short position of Philex Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of BDO Unibank and Philex Mining.
Diversification Opportunities for BDO Unibank and Philex Mining
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between BDO and Philex is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding BDO Unibank and Philex Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Philex Mining Corp 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 Philex Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Philex Mining Corp has no effect on the direction of BDO Unibank i.e., BDO Unibank and Philex Mining go up and down completely randomly.
Pair Corralation between BDO Unibank and Philex Mining
Assuming the 90 days trading horizon BDO Unibank is expected to generate 1.25 times more return on investment than Philex Mining. However, BDO Unibank is 1.25 times more volatile than Philex Mining Corp. It trades about -0.09 of its potential returns per unit of risk. Philex Mining Corp 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 | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BDO Unibank vs. Philex Mining Corp
Performance |
| Timeline |
| BDO Unibank |
| Philex Mining Corp |
BDO Unibank and Philex Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BDO Unibank and Philex Mining
The main advantage of trading using opposite BDO Unibank and Philex Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BDO Unibank position performs unexpectedly, Philex 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 Philex Mining will offset losses from the drop in Philex Mining's long position.| BDO Unibank vs. Lepanto Consolidated Mining | BDO Unibank vs. Apex Mining Co | BDO Unibank vs. Sun Life Financial | BDO Unibank vs. Asia United Bank |
| Philex Mining vs. Pacificonline Systems | Philex Mining vs. BDO Unibank | Philex Mining vs. Metropolitan Bank Trust | Philex Mining vs. Converge Information Communications |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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