Correlation Between Philex Mining and Aboitiz Power
Can any of the company-specific risk be diversified away by investing in both Philex Mining and Aboitiz Power 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 Philex Mining and Aboitiz Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Philex Mining Corp and Aboitiz Power Corp, you can compare the effects of market volatilities on Philex Mining and Aboitiz Power 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 Philex Mining with a short position of Aboitiz Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Philex Mining and Aboitiz Power.
Diversification Opportunities for Philex Mining and Aboitiz Power
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Philex and Aboitiz is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Philex Mining Corp and Aboitiz Power Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aboitiz Power Corp and Philex 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 Philex Mining Corp are associated (or correlated) with Aboitiz Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aboitiz Power Corp has no effect on the direction of Philex Mining i.e., Philex Mining and Aboitiz Power go up and down completely randomly.
Pair Corralation between Philex Mining and Aboitiz Power
Assuming the 90 days trading horizon Philex Mining Corp is expected to generate 1.7 times more return on investment than Aboitiz Power. However, Philex Mining is 1.7 times more volatile than Aboitiz Power Corp. It trades about 0.42 of its potential returns per unit of risk. Aboitiz Power Corp is currently generating about 0.21 per unit of risk. If you would invest 276.00 in Philex Mining Corp on October 20, 2024 and sell it today you would earn a total of 47.00 from holding Philex Mining Corp or generate 17.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Philex Mining Corp vs. Aboitiz Power Corp
Performance |
| Timeline |
| Philex Mining Corp |
| Aboitiz Power Corp |
Philex Mining and Aboitiz Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Philex Mining and Aboitiz Power
The main advantage of trading using opposite Philex Mining and Aboitiz Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Philex Mining position performs unexpectedly, Aboitiz Power 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 Aboitiz Power will offset losses from the drop in Aboitiz Power's long position.| Philex Mining vs. COL Financial Group | Philex Mining vs. Transpacific Broadband Group | Philex Mining vs. Globe Telecom | Philex Mining vs. Philippine Business Bank |
| Aboitiz Power vs. Suntrust Home Developers | Aboitiz Power vs. Philex Mining Corp | Aboitiz Power vs. Converge Information Communications | Aboitiz Power vs. Top Frontier Investment |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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