Correlation Between Philex Mining and National Reinsurance
Can any of the company-specific risk be diversified away by investing in both Philex Mining and National Reinsurance 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 National Reinsurance 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 National Reinsurance, you can compare the effects of market volatilities on Philex Mining and National Reinsurance 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 National Reinsurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Philex Mining and National Reinsurance.
Diversification Opportunities for Philex Mining and National Reinsurance
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Philex and National is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Philex Mining Corp and National Reinsurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Reinsurance 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 National Reinsurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Reinsurance has no effect on the direction of Philex Mining i.e., Philex Mining and National Reinsurance go up and down completely randomly.
Pair Corralation between Philex Mining and National Reinsurance
Assuming the 90 days trading horizon Philex Mining is expected to generate 14.32 times less return on investment than National Reinsurance. But when comparing it to its historical volatility, Philex Mining Corp is 3.55 times less risky than National Reinsurance. It trades about 0.01 of its potential returns per unit of risk. National Reinsurance is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 56.00 in National Reinsurance on September 14, 2024 and sell it today you would earn a total of 12.00 from holding National Reinsurance or generate 21.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 59.46% |
| Values | Daily Returns |
Philex Mining Corp vs. National Reinsurance
Performance |
| Timeline |
| Philex Mining Corp |
| National Reinsurance |
Philex Mining and National Reinsurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Philex Mining and National Reinsurance
The main advantage of trading using opposite Philex Mining and National Reinsurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Philex Mining position performs unexpectedly, National Reinsurance 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 National Reinsurance will offset losses from the drop in National Reinsurance's long position.| Philex Mining vs. Apex Mining Co | Philex Mining vs. Top Frontier Investment | Philex Mining vs. Asia United Bank | Philex Mining vs. Converge Information Communications |
| National Reinsurance vs. GT Capital Holdings | National Reinsurance vs. Allhome Corp | National Reinsurance vs. Jollibee Foods Corp | National Reinsurance 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Transaction History View history of all your transactions and understand their impact on performance |