Correlation Between Dito CME and Metro Retail
Can any of the company-specific risk be diversified away by investing in both Dito CME and Metro Retail 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 Dito CME and Metro Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dito CME Holdings and Metro Retail Stores, you can compare the effects of market volatilities on Dito CME and Metro Retail 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 Dito CME with a short position of Metro Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dito CME and Metro Retail.
Diversification Opportunities for Dito CME and Metro Retail
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Dito and Metro is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Dito CME Holdings and Metro Retail Stores in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metro Retail Stores and Dito CME 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 Dito CME Holdings are associated (or correlated) with Metro Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metro Retail Stores has no effect on the direction of Dito CME i.e., Dito CME and Metro Retail go up and down completely randomly.
Pair Corralation between Dito CME and Metro Retail
Assuming the 90 days trading horizon Dito CME Holdings is expected to under-perform the Metro Retail. In addition to that, Dito CME is 4.29 times more volatile than Metro Retail Stores. It trades about -0.15 of its total potential returns per unit of risk. Metro Retail Stores is currently generating about 0.01 per unit of volatility. If you would invest 121.00 in Metro Retail Stores on September 1, 2024 and sell it today you would earn a total of 0.00 from holding Metro Retail Stores or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 86.36% |
| Values | Daily Returns |
Dito CME Holdings vs. Metro Retail Stores
Performance |
| Timeline |
| Dito CME Holdings |
| Metro Retail Stores |
Dito CME and Metro Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dito CME and Metro Retail
The main advantage of trading using opposite Dito CME and Metro Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dito CME position performs unexpectedly, Metro Retail 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 Metro Retail will offset losses from the drop in Metro Retail's long position.| Dito CME vs. Metro Retail Stores | Dito CME vs. East West Banking | Dito CME vs. SM Investments Corp | Dito CME vs. Transpacific Broadband Group |
| Metro Retail vs. Philex Mining Corp | Metro Retail vs. Apex Mining Co | Metro Retail vs. Top Frontier Investment | Metro Retail vs. SM Investments 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.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |