Correlation Between Cosco Capital and Century Pacific
Can any of the company-specific risk be diversified away by investing in both Cosco Capital and Century Pacific 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 Cosco Capital and Century Pacific into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cosco Capital and Century Pacific Food, you can compare the effects of market volatilities on Cosco Capital and Century Pacific 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 Cosco Capital with a short position of Century Pacific. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cosco Capital and Century Pacific.
Diversification Opportunities for Cosco Capital and Century Pacific
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cosco and Century is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Cosco Capital and Century Pacific Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Century Pacific Food and Cosco Capital 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 Cosco Capital are associated (or correlated) with Century Pacific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Century Pacific Food has no effect on the direction of Cosco Capital i.e., Cosco Capital and Century Pacific go up and down completely randomly.
Pair Corralation between Cosco Capital and Century Pacific
Assuming the 90 days trading horizon Cosco Capital is expected to under-perform the Century Pacific. In addition to that, Cosco Capital is 1.02 times more volatile than Century Pacific Food. It trades about -0.02 of its total potential returns per unit of risk. Century Pacific Food is currently generating about 0.28 per unit of volatility. If you would invest 4,080 in Century Pacific Food on September 13, 2024 and sell it today you would earn a total of 415.00 from holding Century Pacific Food or generate 10.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cosco Capital vs. Century Pacific Food
Performance |
| Timeline |
| Cosco Capital |
| Century Pacific Food |
Cosco Capital and Century Pacific Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cosco Capital and Century Pacific
The main advantage of trading using opposite Cosco Capital and Century Pacific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cosco Capital position performs unexpectedly, Century Pacific 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 Century Pacific will offset losses from the drop in Century Pacific's long position.| Cosco Capital vs. STI Education Systems | Cosco Capital vs. Century Pacific Food | Cosco Capital vs. Lepanto Consolidated Mining | Cosco Capital vs. Globe Telecom |
| Century Pacific vs. Apex Mining Co | Century Pacific vs. Pacificonline Systems | Century Pacific vs. Jollibee Foods Corp | Century Pacific vs. Transpacific Broadband 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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