Correlation Between COL Financial and Emperador
Can any of the company-specific risk be diversified away by investing in both COL Financial and Emperador 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 COL Financial and Emperador into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COL Financial Group and Emperador, you can compare the effects of market volatilities on COL Financial and Emperador 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 COL Financial with a short position of Emperador. Check out your portfolio center. Please also check ongoing floating volatility patterns of COL Financial and Emperador.
Diversification Opportunities for COL Financial and Emperador
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between COL and Emperador is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding COL Financial Group and Emperador in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emperador and COL Financial 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 COL Financial Group are associated (or correlated) with Emperador. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emperador has no effect on the direction of COL Financial i.e., COL Financial and Emperador go up and down completely randomly.
Pair Corralation between COL Financial and Emperador
Assuming the 90 days trading horizon COL Financial Group is expected to under-perform the Emperador. In addition to that, COL Financial is 2.67 times more volatile than Emperador. It trades about -0.04 of its total potential returns per unit of risk. Emperador is currently generating about -0.03 per unit of volatility. If you would invest 2,030 in Emperador on September 5, 2024 and sell it today you would lose (226.00) from holding Emperador or give up 11.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 91.7% |
| Values | Daily Returns |
COL Financial Group vs. Emperador
Performance |
| Timeline |
| COL Financial Group |
| Emperador |
COL Financial and Emperador Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COL Financial and Emperador
The main advantage of trading using opposite COL Financial and Emperador positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COL Financial position performs unexpectedly, Emperador 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 Emperador will offset losses from the drop in Emperador's long position.| COL Financial vs. Bright Kindle Resources | COL Financial vs. GT Capital Holdings | COL Financial vs. Allhome Corp | COL Financial vs. Jollibee Foods Corp |
| Emperador vs. Union Bank of | Emperador vs. COL Financial Group | Emperador vs. Integrated Micro Electronics | Emperador vs. Philex Mining 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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