Correlation Between STI Education and East West
Can any of the company-specific risk be diversified away by investing in both STI Education and East West 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 East West 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 East West Banking, you can compare the effects of market volatilities on STI Education and East West 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 East West. Check out your portfolio center. Please also check ongoing floating volatility patterns of STI Education and East West.
Diversification Opportunities for STI Education and East West
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between STI and East is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding STI Education Systems and East West Banking in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on East West Banking 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 East West. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of East West Banking has no effect on the direction of STI Education i.e., STI Education and East West go up and down completely randomly.
Pair Corralation between STI Education and East West
Assuming the 90 days trading horizon STI Education Systems is expected to generate 2.44 times more return on investment than East West. However, STI Education is 2.44 times more volatile than East West Banking. It trades about 0.12 of its potential returns per unit of risk. East West Banking is currently generating about 0.08 per unit of risk. If you would invest 104.00 in STI Education Systems on November 2, 2024 and sell it today you would earn a total of 36.00 from holding STI Education Systems or generate 34.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
STI Education Systems vs. East West Banking
Performance |
| Timeline |
| STI Education Systems |
| East West Banking |
STI Education and East West Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with STI Education and East West
The main advantage of trading using opposite STI Education and East West positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STI Education position performs unexpectedly, East West 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 East West will offset losses from the drop in East West's long position.| STI Education vs. Converge Information Communications | STI Education vs. First Abacus Financial | STI Education vs. Allhome Corp | STI Education vs. Monde Nissin Corp |
| East West vs. Crown Asia Chemicals | East West vs. Rizal Commercial Banking | East West vs. Security Bank Corp | East West vs. Integrated Micro Electronics |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |