Correlation Between PLDT and Concepcion Industrial
Can any of the company-specific risk be diversified away by investing in both PLDT and Concepcion Industrial 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 PLDT and Concepcion Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PLDT Inc and Concepcion Industrial Corp, you can compare the effects of market volatilities on PLDT and Concepcion Industrial 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 PLDT with a short position of Concepcion Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of PLDT and Concepcion Industrial.
Diversification Opportunities for PLDT and Concepcion Industrial
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PLDT and Concepcion is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding PLDT Inc and Concepcion Industrial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Concepcion Industrial and PLDT 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 PLDT Inc are associated (or correlated) with Concepcion Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Concepcion Industrial has no effect on the direction of PLDT i.e., PLDT and Concepcion Industrial go up and down completely randomly.
Pair Corralation between PLDT and Concepcion Industrial
Assuming the 90 days trading horizon PLDT Inc is expected to generate 1.14 times more return on investment than Concepcion Industrial. However, PLDT is 1.14 times more volatile than Concepcion Industrial Corp. It trades about -0.06 of its potential returns per unit of risk. Concepcion Industrial Corp is currently generating about -0.07 per unit of risk. If you would invest 140,000 in PLDT Inc on October 9, 2024 and sell it today you would lose (7,000) from holding PLDT Inc or give up 5.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
PLDT Inc vs. Concepcion Industrial Corp
Performance |
| Timeline |
| PLDT Inc |
| Concepcion Industrial |
PLDT and Concepcion Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PLDT and Concepcion Industrial
The main advantage of trading using opposite PLDT and Concepcion Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PLDT position performs unexpectedly, Concepcion Industrial 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 Concepcion Industrial will offset losses from the drop in Concepcion Industrial's long position.| PLDT vs. Philippine Savings Bank | PLDT vs. BDO Unibank | PLDT vs. Crown Asia Chemicals | PLDT vs. Century Pacific Food |
| Concepcion Industrial vs. Philex Mining Corp | Concepcion Industrial vs. Metropolitan Bank Trust | Concepcion Industrial vs. Union Bank of | Concepcion Industrial vs. Bank of the |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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