Correlation Between STI Education and Del Monte
Can any of the company-specific risk be diversified away by investing in both STI Education and Del Monte 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 STI Education and Del Monte into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between STI Education Systems and Del Monte Pacific, you can compare the effects of market volatilities on STI Education and Del Monte 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 STI Education with a short position of Del Monte. Check out your portfolio center. Please also check ongoing floating volatility patterns of STI Education and Del Monte.
Diversification Opportunities for STI Education and Del Monte
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between STI and Del is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding STI Education Systems and Del Monte Pacific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Del Monte Pacific and STI Education 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 STI Education Systems are associated (or correlated) with Del Monte. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Del Monte Pacific has no effect on the direction of STI Education i.e., STI Education and Del Monte go up and down completely randomly.
Pair Corralation between STI Education and Del Monte
Assuming the 90 days trading horizon STI Education Systems is expected to generate 0.85 times more return on investment than Del Monte. However, STI Education Systems is 1.18 times less risky than Del Monte. It trades about 0.08 of its potential returns per unit of risk. Del Monte Pacific is currently generating about -0.04 per unit of risk. If you would invest 107.00 in STI Education Systems on September 2, 2024 and sell it today you would earn a total of 14.00 from holding STI Education Systems or generate 13.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 86.15% |
| Values | Daily Returns |
STI Education Systems vs. Del Monte Pacific
Performance |
| Timeline |
| STI Education Systems |
| Del Monte Pacific |
STI Education and Del Monte Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with STI Education and Del Monte
The main advantage of trading using opposite STI Education and Del Monte positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STI Education position performs unexpectedly, Del Monte 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 Del Monte will offset losses from the drop in Del Monte's long position.| STI Education vs. Allhome Corp | STI Education vs. LFM Properties Corp | STI Education vs. Altus Property Ventures | STI Education vs. Monde Nissin 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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