Correlation Between THE PHILIPPINE and Manila Mining
Can any of the company-specific risk be diversified away by investing in both THE PHILIPPINE and Manila Mining 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 THE PHILIPPINE and Manila Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between THE PHILIPPINE STOCK and Manila Mining Corp, you can compare the effects of market volatilities on THE PHILIPPINE and Manila Mining 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 THE PHILIPPINE with a short position of Manila Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of THE PHILIPPINE and Manila Mining.
Diversification Opportunities for THE PHILIPPINE and Manila Mining
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between THE and Manila is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding THE PHILIPPINE STOCK and Manila Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manila Mining Corp and THE PHILIPPINE 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 THE PHILIPPINE STOCK are associated (or correlated) with Manila Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manila Mining Corp has no effect on the direction of THE PHILIPPINE i.e., THE PHILIPPINE and Manila Mining go up and down completely randomly.
Pair Corralation between THE PHILIPPINE and Manila Mining
Assuming the 90 days trading horizon THE PHILIPPINE STOCK is expected to under-perform the Manila Mining. But the index apears to be less risky and, when comparing its historical volatility, THE PHILIPPINE STOCK is 4.47 times less risky than Manila Mining. The index trades about -0.04 of its potential returns per unit of risk. The Manila Mining Corp is currently generating about 0.64 of returns per unit of risk over similar time horizon. If you would invest 0.30 in Manila Mining Corp on November 27, 2024 and sell it today you would earn a total of 0.17 from holding Manila Mining Corp or generate 56.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 50.0% |
| Values | Daily Returns |
THE PHILIPPINE STOCK vs. Manila Mining Corp
Performance |
| Timeline |
THE PHILIPPINE and Manila Mining Volatility Contrast
Predicted Return Density |
| Returns |
THE PHILIPPINE STOCK
Pair trading matchups for THE PHILIPPINE
Manila Mining Corp
Pair trading matchups for Manila Mining
Pair Trading with THE PHILIPPINE and Manila Mining
The main advantage of trading using opposite THE PHILIPPINE and Manila Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if THE PHILIPPINE position performs unexpectedly, Manila Mining 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 Manila Mining will offset losses from the drop in Manila Mining's long position.| THE PHILIPPINE vs. Concepcion Industrial Corp | THE PHILIPPINE vs. Semirara Mining Corp | THE PHILIPPINE vs. Atlas Consolidated Mining | THE PHILIPPINE vs. Lepanto Consolidated Mining |
| Manila Mining vs. Metro Retail Stores | Manila Mining vs. Figaro Coffee Group | Manila Mining vs. Union Bank of | Manila Mining vs. Robinsons Retail Holdings |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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