Correlation Between LFM Properties and Century Pacific
Can any of the company-specific risk be diversified away by investing in both LFM Properties 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 LFM Properties and Century Pacific into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LFM Properties Corp and Century Pacific Food, you can compare the effects of market volatilities on LFM Properties 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 LFM Properties with a short position of Century Pacific. Check out your portfolio center. Please also check ongoing floating volatility patterns of LFM Properties and Century Pacific.
Diversification Opportunities for LFM Properties and Century Pacific
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between LFM and Century is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding LFM Properties Corp 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 LFM Properties 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 LFM Properties Corp 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 LFM Properties i.e., LFM Properties and Century Pacific go up and down completely randomly.
Pair Corralation between LFM Properties and Century Pacific
Assuming the 90 days trading horizon LFM Properties Corp is expected to generate 4.37 times more return on investment than Century Pacific. However, LFM Properties is 4.37 times more volatile than Century Pacific Food. It trades about 0.01 of its potential returns per unit of risk. Century Pacific Food is currently generating about 0.04 per unit of risk. If you would invest 9.10 in LFM Properties Corp on January 17, 2025 and sell it today you would lose (4.90) from holding LFM Properties Corp or give up 53.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 50.52% |
| Values | Daily Returns |
LFM Properties Corp vs. Century Pacific Food
Performance |
| Timeline |
| LFM Properties Corp |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| Century Pacific Food |
LFM Properties and Century Pacific Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LFM Properties and Century Pacific
The main advantage of trading using opposite LFM Properties and Century Pacific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LFM Properties 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.| LFM Properties vs. Philippine Business Bank | LFM Properties vs. Asia United Bank | LFM Properties vs. BDO Unibank | LFM Properties vs. Transpacific Broadband Group |
| Century Pacific vs. East West Banking | Century Pacific vs. Semirara Mining Corp | Century Pacific vs. SM Investments Corp | Century Pacific 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |