Correlation Between Concepcion Industrial and PHINMA Corp
Can any of the company-specific risk be diversified away by investing in both Concepcion Industrial and PHINMA Corp 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 Concepcion Industrial and PHINMA Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Concepcion Industrial Corp and PHINMA Corp, you can compare the effects of market volatilities on Concepcion Industrial and PHINMA Corp 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 Concepcion Industrial with a short position of PHINMA Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Concepcion Industrial and PHINMA Corp.
Diversification Opportunities for Concepcion Industrial and PHINMA Corp
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Concepcion and PHINMA is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Concepcion Industrial Corp and PHINMA Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PHINMA Corp and Concepcion Industrial 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 Concepcion Industrial Corp are associated (or correlated) with PHINMA Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PHINMA Corp has no effect on the direction of Concepcion Industrial i.e., Concepcion Industrial and PHINMA Corp go up and down completely randomly.
Pair Corralation between Concepcion Industrial and PHINMA Corp
Assuming the 90 days trading horizon Concepcion Industrial Corp is expected to under-perform the PHINMA Corp. But the stock apears to be less risky and, when comparing its historical volatility, Concepcion Industrial Corp is 1.34 times less risky than PHINMA Corp. The stock trades about -0.05 of its potential returns per unit of risk. The PHINMA Corp is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 1,993 in PHINMA Corp on September 13, 2024 and sell it today you would lose (53.00) from holding PHINMA Corp or give up 2.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 92.68% |
| Values | Daily Returns |
Concepcion Industrial Corp vs. PHINMA Corp
Performance |
| Timeline |
| Concepcion Industrial |
| PHINMA Corp |
Concepcion Industrial and PHINMA Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Concepcion Industrial and PHINMA Corp
The main advantage of trading using opposite Concepcion Industrial and PHINMA Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Concepcion Industrial position performs unexpectedly, PHINMA Corp 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 PHINMA Corp will offset losses from the drop in PHINMA Corp's long position.| Concepcion Industrial vs. COL Financial Group | Concepcion Industrial vs. Figaro Coffee Group | Concepcion Industrial vs. Metropolitan Bank Trust | Concepcion Industrial vs. Jollibee Foods Corp |
| PHINMA Corp vs. Apex Mining Co | PHINMA Corp vs. Security Bank Corp | PHINMA Corp vs. Century Pacific Food | PHINMA Corp vs. Lepanto Consolidated Mining |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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