Correlation Between Philippine National and Atlas Consolidated
Can any of the company-specific risk be diversified away by investing in both Philippine National and Atlas Consolidated 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 Philippine National and Atlas Consolidated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Philippine National Bank and Atlas Consolidated Mining, you can compare the effects of market volatilities on Philippine National and Atlas Consolidated 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 Philippine National with a short position of Atlas Consolidated. Check out your portfolio center. Please also check ongoing floating volatility patterns of Philippine National and Atlas Consolidated.
Diversification Opportunities for Philippine National and Atlas Consolidated
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Philippine and Atlas is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Philippine National Bank and Atlas Consolidated Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlas Consolidated Mining and Philippine National 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 Philippine National Bank are associated (or correlated) with Atlas Consolidated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlas Consolidated Mining has no effect on the direction of Philippine National i.e., Philippine National and Atlas Consolidated go up and down completely randomly.
Pair Corralation between Philippine National and Atlas Consolidated
Assuming the 90 days trading horizon Philippine National Bank is expected to generate 0.95 times more return on investment than Atlas Consolidated. However, Philippine National Bank is 1.06 times less risky than Atlas Consolidated. It trades about -0.14 of its potential returns per unit of risk. Atlas Consolidated Mining is currently generating about -0.39 per unit of risk. If you would invest 2,740 in Philippine National Bank on September 4, 2024 and sell it today you would lose (155.00) from holding Philippine National Bank or give up 5.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Philippine National Bank vs. Atlas Consolidated Mining
Performance |
| Timeline |
| Philippine National Bank |
| Atlas Consolidated Mining |
Philippine National and Atlas Consolidated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Philippine National and Atlas Consolidated
The main advantage of trading using opposite Philippine National and Atlas Consolidated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Philippine National position performs unexpectedly, Atlas Consolidated 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 Atlas Consolidated will offset losses from the drop in Atlas Consolidated's long position.| Philippine National vs. Jollibee Foods Corp | Philippine National vs. Premiere Entertainment | Philippine National vs. Semirara Mining Corp | Philippine National vs. Apex Mining Co |
| Atlas Consolidated vs. Nickel Asia Corp | Atlas Consolidated vs. Apollo Global Capital | Atlas Consolidated vs. Philex Mining Corp | Atlas Consolidated 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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