Correlation Between San Miguel and Omico Corp
Can any of the company-specific risk be diversified away by investing in both San Miguel and Omico 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 San Miguel and Omico Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between San Miguel Pure and Omico Corp, you can compare the effects of market volatilities on San Miguel and Omico 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 San Miguel with a short position of Omico Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of San Miguel and Omico Corp.
Diversification Opportunities for San Miguel and Omico Corp
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between San and Omico is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding San Miguel Pure and Omico Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Omico Corp and San Miguel 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 San Miguel Pure are associated (or correlated) with Omico Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Omico Corp has no effect on the direction of San Miguel i.e., San Miguel and Omico Corp go up and down completely randomly.
Pair Corralation between San Miguel and Omico Corp
Assuming the 90 days trading horizon San Miguel is expected to generate 14.38 times less return on investment than Omico Corp. But when comparing it to its historical volatility, San Miguel Pure is 10.49 times less risky than Omico Corp. It trades about 0.1 of its potential returns per unit of risk. Omico Corp is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 13.00 in Omico Corp on November 28, 2024 and sell it today you would earn a total of 1.00 from holding Omico Corp or generate 7.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 27.27% |
| Values | Daily Returns |
San Miguel Pure vs. Omico Corp
Performance |
| Timeline |
| San Miguel Pure |
| Omico Corp |
Risk-Adjusted Performance
OK
Weak | Strong |
San Miguel and Omico Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with San Miguel and Omico Corp
The main advantage of trading using opposite San Miguel and Omico Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if San Miguel position performs unexpectedly, Omico 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 Omico Corp will offset losses from the drop in Omico Corp's long position.| San Miguel vs. Converge Information Communications | San Miguel vs. Semirara Mining Corp | San Miguel vs. SM Investments Corp | San Miguel vs. Atlas Consolidated Mining |
| Omico Corp vs. Century Pacific Food | Omico Corp vs. Semirara Mining Corp | Omico Corp vs. Philex Mining Corp | Omico 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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