Correlation Between PLDT and Philex Mining
Can any of the company-specific risk be diversified away by investing in both PLDT and Philex Mining 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 Philex Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PLDT Inc and Philex Mining Corp, you can compare the effects of market volatilities on PLDT and Philex Mining 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 Philex Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of PLDT and Philex Mining.
Diversification Opportunities for PLDT and Philex Mining
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PLDT and Philex is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding PLDT Inc and Philex Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Philex Mining Corp 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 Philex Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Philex Mining Corp has no effect on the direction of PLDT i.e., PLDT and Philex Mining go up and down completely randomly.
Pair Corralation between PLDT and Philex Mining
Assuming the 90 days trading horizon PLDT is expected to generate 19.31 times less return on investment than Philex Mining. But when comparing it to its historical volatility, PLDT Inc is 3.36 times less risky than Philex Mining. It trades about 0.05 of its potential returns per unit of risk. Philex Mining Corp is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 279.00 in Philex Mining Corp on November 30, 2024 and sell it today you would earn a total of 182.00 from holding Philex Mining Corp or generate 65.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PLDT Inc vs. Philex Mining Corp
Performance |
| Timeline |
| PLDT Inc |
| Philex Mining Corp |
PLDT and Philex Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PLDT and Philex Mining
The main advantage of trading using opposite PLDT and Philex Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PLDT position performs unexpectedly, Philex Mining 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 Philex Mining will offset losses from the drop in Philex Mining's long position.| PLDT vs. Robinsons Retail Holdings | PLDT vs. Suntrust Home Developers | PLDT vs. Crown Asia Chemicals | PLDT vs. Lepanto Consolidated Mining |
| Philex Mining vs. Swift Foods | Philex Mining vs. Crown Asia Chemicals | Philex Mining vs. Transpacific Broadband Group | Philex Mining vs. STI Education Systems |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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