Correlation Between Security Bank and San Miguel
Can any of the company-specific risk be diversified away by investing in both Security Bank and San Miguel 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 Security Bank and San Miguel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Security Bank Corp and San Miguel Corp, you can compare the effects of market volatilities on Security Bank and San Miguel 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 Security Bank with a short position of San Miguel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Security Bank and San Miguel.
Diversification Opportunities for Security Bank and San Miguel
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Security and San is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Security Bank Corp and San Miguel Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on San Miguel Corp and Security Bank 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 Security Bank Corp are associated (or correlated) with San Miguel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of San Miguel Corp has no effect on the direction of Security Bank i.e., Security Bank and San Miguel go up and down completely randomly.
Pair Corralation between Security Bank and San Miguel
Assuming the 90 days trading horizon Security Bank Corp is expected to generate 7.03 times more return on investment than San Miguel. However, Security Bank is 7.03 times more volatile than San Miguel Corp. It trades about 0.13 of its potential returns per unit of risk. San Miguel Corp is currently generating about 0.18 per unit of risk. If you would invest 7,910 in Security Bank Corp on September 14, 2024 and sell it today you would earn a total of 400.00 from holding Security Bank Corp or generate 5.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Security Bank Corp vs. San Miguel Corp
Performance |
| Timeline |
| Security Bank Corp |
| San Miguel Corp |
Security Bank and San Miguel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Security Bank and San Miguel
The main advantage of trading using opposite Security Bank and San Miguel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Security Bank position performs unexpectedly, San Miguel 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 San Miguel will offset losses from the drop in San Miguel's long position.| Security Bank vs. BDO Unibank | Security Bank vs. Metropolitan Bank Trust | Security Bank vs. Union Bank of | Security Bank vs. Philippine National Bank |
| San Miguel vs. National Reinsurance | San Miguel vs. Jollibee Foods Corp | San Miguel vs. Concepcion Industrial Corp | San Miguel vs. Asia United Bank |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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