Correlation Between Manila Mining and STI Education
Can any of the company-specific risk be diversified away by investing in both Manila Mining and STI Education 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 Manila Mining and STI Education into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Manila Mining Corp and STI Education Systems, you can compare the effects of market volatilities on Manila Mining and STI Education 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 Manila Mining with a short position of STI Education. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manila Mining and STI Education.
Diversification Opportunities for Manila Mining and STI Education
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Manila and STI is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Manila Mining Corp and STI Education Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STI Education Systems and Manila Mining 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 Manila Mining Corp are associated (or correlated) with STI Education. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STI Education Systems has no effect on the direction of Manila Mining i.e., Manila Mining and STI Education go up and down completely randomly.
Pair Corralation between Manila Mining and STI Education
Assuming the 90 days trading horizon Manila Mining Corp is expected to under-perform the STI Education. In addition to that, Manila Mining is 1.81 times more volatile than STI Education Systems. It trades about -0.1 of its total potential returns per unit of risk. STI Education Systems is currently generating about 0.13 per unit of volatility. If you would invest 33.00 in STI Education Systems on September 1, 2024 and sell it today you would earn a total of 88.00 from holding STI Education Systems or generate 266.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 45.1% |
| Values | Daily Returns |
Manila Mining Corp vs. STI Education Systems
Performance |
| Timeline |
| Manila Mining Corp |
| STI Education Systems |
Manila Mining and STI Education Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Manila Mining and STI Education
The main advantage of trading using opposite Manila Mining and STI Education positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manila Mining position performs unexpectedly, STI Education 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 STI Education will offset losses from the drop in STI Education's long position.The idea behind Manila Mining Corp and STI Education Systems pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| STI Education vs. Allhome Corp | STI Education vs. LFM Properties Corp | STI Education vs. Altus Property Ventures | STI Education vs. Monde Nissin 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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