Correlation Between Century Pacific and Philex Mining
Can any of the company-specific risk be diversified away by investing in both Century Pacific 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 Century Pacific and Philex Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Century Pacific Food and Philex Mining Corp, you can compare the effects of market volatilities on Century Pacific 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 Century Pacific with a short position of Philex Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Century Pacific and Philex Mining.
Diversification Opportunities for Century Pacific and Philex Mining
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Century and Philex is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Century Pacific Food 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 Century Pacific 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 Century Pacific Food 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 Century Pacific i.e., Century Pacific and Philex Mining go up and down completely randomly.
Pair Corralation between Century Pacific and Philex Mining
Assuming the 90 days trading horizon Century Pacific Food is expected to generate 0.8 times more return on investment than Philex Mining. However, Century Pacific Food is 1.25 times less risky than Philex Mining. It trades about 0.14 of its potential returns per unit of risk. Philex Mining Corp is currently generating about 0.03 per unit of risk. If you would invest 3,620 in Century Pacific Food on August 31, 2024 and sell it today you would earn a total of 550.00 from holding Century Pacific Food or generate 15.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Century Pacific Food vs. Philex Mining Corp
Performance |
| Timeline |
| Century Pacific Food |
| Philex Mining Corp |
Century Pacific and Philex Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Century Pacific and Philex Mining
The main advantage of trading using opposite Century Pacific and Philex Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Century Pacific 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.| Century Pacific vs. Alliance Select Foods | Century Pacific vs. East West Banking | Century Pacific vs. Manulife Financial Corp | Century Pacific vs. Robinsons Retail Holdings |
| Philex Mining vs. Robinsons Retail Holdings | Philex Mining vs. Lepanto Consolidated Mining | Philex Mining vs. Atlas Consolidated Mining | Philex Mining vs. COL Financial Group |
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 CEOs Directory module to screen CEOs from public companies around the world.
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