Correlation Between Globe Telecom and Jollibee Foods
Can any of the company-specific risk be diversified away by investing in both Globe Telecom and Jollibee Foods 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 Globe Telecom and Jollibee Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Globe Telecom and Jollibee Foods Corp, you can compare the effects of market volatilities on Globe Telecom and Jollibee Foods 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 Globe Telecom with a short position of Jollibee Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Globe Telecom and Jollibee Foods.
Diversification Opportunities for Globe Telecom and Jollibee Foods
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Globe and Jollibee is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Globe Telecom and Jollibee Foods Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jollibee Foods Corp and Globe Telecom 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 Globe Telecom are associated (or correlated) with Jollibee Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jollibee Foods Corp has no effect on the direction of Globe Telecom i.e., Globe Telecom and Jollibee Foods go up and down completely randomly.
Pair Corralation between Globe Telecom and Jollibee Foods
Assuming the 90 days trading horizon Globe Telecom is expected to generate 0.81 times more return on investment than Jollibee Foods. However, Globe Telecom is 1.24 times less risky than Jollibee Foods. It trades about 0.08 of its potential returns per unit of risk. Jollibee Foods Corp is currently generating about -0.42 per unit of risk. If you would invest 215,600 in Globe Telecom on November 3, 2024 and sell it today you would earn a total of 5,400 from holding Globe Telecom or generate 2.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Globe Telecom vs. Jollibee Foods Corp
Performance |
| Timeline |
| Globe Telecom |
| Jollibee Foods Corp |
Globe Telecom and Jollibee Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Globe Telecom and Jollibee Foods
The main advantage of trading using opposite Globe Telecom and Jollibee Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Globe Telecom position performs unexpectedly, Jollibee Foods 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 Jollibee Foods will offset losses from the drop in Jollibee Foods' long position.| Globe Telecom vs. Rizal Commercial Banking | Globe Telecom vs. Philex Mining Corp | Globe Telecom vs. Concepcion Industrial Corp | Globe Telecom vs. Atlas Consolidated Mining |
| Jollibee Foods vs. Philex Mining Corp | Jollibee Foods vs. Allhome Corp | Jollibee Foods vs. East West Banking | Jollibee Foods 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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