Correlation Between Megawide Construction and STI Education
Can any of the company-specific risk be diversified away by investing in both Megawide Construction 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 Megawide Construction and STI Education into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Megawide Construction Corp and STI Education Systems, you can compare the effects of market volatilities on Megawide Construction 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 Megawide Construction with a short position of STI Education. Check out your portfolio center. Please also check ongoing floating volatility patterns of Megawide Construction and STI Education.
Diversification Opportunities for Megawide Construction and STI Education
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Megawide and STI is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Megawide Construction 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 Megawide Construction 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 Megawide Construction 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 Megawide Construction i.e., Megawide Construction and STI Education go up and down completely randomly.
Pair Corralation between Megawide Construction and STI Education
Assuming the 90 days trading horizon Megawide Construction Corp is expected to generate 0.44 times more return on investment than STI Education. However, Megawide Construction Corp is 2.26 times less risky than STI Education. It trades about 0.43 of its potential returns per unit of risk. STI Education Systems is currently generating about 0.1 per unit of risk. If you would invest 9,440 in Megawide Construction Corp on September 13, 2024 and sell it today you would earn a total of 350.00 from holding Megawide Construction Corp or generate 3.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 43.48% |
| Values | Daily Returns |
Megawide Construction Corp vs. STI Education Systems
Performance |
| Timeline |
| Megawide Construction |
| STI Education Systems |
Megawide Construction and STI Education Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Megawide Construction and STI Education
The main advantage of trading using opposite Megawide Construction and STI Education positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Megawide Construction 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.| Megawide Construction vs. Araneta Properties | Megawide Construction vs. GT Capital Holdings | Megawide Construction vs. Allhome Corp | Megawide Construction vs. Jollibee Foods Corp |
| STI Education vs. GT Capital Holdings | STI Education vs. Allhome Corp | STI Education vs. Jollibee Foods Corp | STI Education vs. LFM Properties 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |