Correlation Between Oriental Petroleum and Jollibee Foods
Can any of the company-specific risk be diversified away by investing in both Oriental Petroleum 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 Oriental Petroleum and Jollibee Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oriental Petroleum and and Jollibee Foods Corp, you can compare the effects of market volatilities on Oriental Petroleum 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 Oriental Petroleum with a short position of Jollibee Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oriental Petroleum and Jollibee Foods.
Diversification Opportunities for Oriental Petroleum and Jollibee Foods
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Oriental and Jollibee is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Oriental Petroleum and 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 Oriental Petroleum 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 Oriental Petroleum and 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 Oriental Petroleum i.e., Oriental Petroleum and Jollibee Foods go up and down completely randomly.
Pair Corralation between Oriental Petroleum and Jollibee Foods
Assuming the 90 days trading horizon Oriental Petroleum and is expected to under-perform the Jollibee Foods. In addition to that, Oriental Petroleum is 1.93 times more volatile than Jollibee Foods Corp. It trades about -0.04 of its total potential returns per unit of risk. Jollibee Foods Corp is currently generating about 0.08 per unit of volatility. If you would invest 22,249 in Jollibee Foods Corp on September 1, 2024 and sell it today you would earn a total of 3,551 from holding Jollibee Foods Corp or generate 15.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 89.52% |
| Values | Daily Returns |
Oriental Petroleum and vs. Jollibee Foods Corp
Performance |
| Timeline |
| Oriental Petroleum and |
| Jollibee Foods Corp |
Oriental Petroleum and Jollibee Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oriental Petroleum and Jollibee Foods
The main advantage of trading using opposite Oriental Petroleum and Jollibee Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oriental Petroleum 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.| Oriental Petroleum vs. Integrated Micro Electronics | Oriental Petroleum vs. Robinsons Retail Holdings | Oriental Petroleum vs. Century Pacific Food | Oriental Petroleum vs. Alliance Select Foods |
| Jollibee Foods vs. Metropolitan Bank Trust | Jollibee Foods vs. Philex Mining Corp | Jollibee Foods vs. Top Frontier Investment | Jollibee Foods vs. BDO Unibank |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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