Correlation Between Jollibee Foods and East West
Can any of the company-specific risk be diversified away by investing in both Jollibee Foods and East West 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 Jollibee Foods and East West into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jollibee Foods Corp and East West Banking, you can compare the effects of market volatilities on Jollibee Foods and East West 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 Jollibee Foods with a short position of East West. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jollibee Foods and East West.
Diversification Opportunities for Jollibee Foods and East West
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jollibee and East is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Jollibee Foods Corp and East West Banking in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on East West Banking and Jollibee Foods 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 Jollibee Foods Corp are associated (or correlated) with East West. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of East West Banking has no effect on the direction of Jollibee Foods i.e., Jollibee Foods and East West go up and down completely randomly.
Pair Corralation between Jollibee Foods and East West
Assuming the 90 days trading horizon Jollibee Foods Corp is expected to generate 1.26 times more return on investment than East West. However, Jollibee Foods is 1.26 times more volatile than East West Banking. It trades about 0.09 of its potential returns per unit of risk. East West Banking is currently generating about 0.11 per unit of risk. If you would invest 25,308 in Jollibee Foods Corp on August 28, 2024 and sell it today you would earn a total of 2,252 from holding Jollibee Foods Corp or generate 8.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jollibee Foods Corp vs. East West Banking
Performance |
| Timeline |
| Jollibee Foods Corp |
| East West Banking |
Jollibee Foods and East West Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jollibee Foods and East West
The main advantage of trading using opposite Jollibee Foods and East West positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jollibee Foods position performs unexpectedly, East West 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 East West will offset losses from the drop in East West's long position.| Jollibee Foods vs. Allhome Corp | Jollibee Foods vs. LFM Properties Corp | Jollibee Foods vs. PXP Energy Corp | Jollibee Foods vs. Monde Nissin Corp |
| East West vs. Integrated Micro Electronics | East West vs. Metropolitan Bank Trust | East West vs. Globe Telecom | East West vs. Philippine Business Bank |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |