Correlation Between First Abacus and San Miguel

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Can any of the company-specific risk be diversified away by investing in both First Abacus 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 First Abacus and San Miguel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Abacus Financial and San Miguel Pure, you can compare the effects of market volatilities on First Abacus 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 First Abacus with a short position of San Miguel. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Abacus and San Miguel.

Diversification Opportunities for First Abacus and San Miguel

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  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between First and San is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding First Abacus Financial and San Miguel Pure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on San Miguel Pure and First Abacus 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 First Abacus Financial 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 Pure has no effect on the direction of First Abacus i.e., First Abacus and San Miguel go up and down completely randomly.

Pair Corralation between First Abacus and San Miguel

Assuming the 90 days trading horizon First Abacus is expected to generate 1.12 times less return on investment than San Miguel. In addition to that, First Abacus is 3.83 times more volatile than San Miguel Pure. It trades about 0.01 of its total potential returns per unit of risk. San Miguel Pure is currently generating about 0.05 per unit of volatility. If you would invest  5,079  in San Miguel Pure on September 12, 2024 and sell it today you would earn a total of  211.00  from holding San Miguel Pure or generate 4.15% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy26.98%
ValuesDaily Returns

First Abacus Financial  vs.  San Miguel Pure

 Performance 
       Timeline  
First Abacus Financial 

Risk-Adjusted Performance

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Strong
Very Weak
Over the last 90 days First Abacus Financial has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, First Abacus is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.
San Miguel Pure 

Risk-Adjusted Performance

3 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in San Miguel Pure are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, San Miguel is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

First Abacus and San Miguel Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with First Abacus and San Miguel

The main advantage of trading using opposite First Abacus and San Miguel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Abacus 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.
The idea behind First Abacus Financial and San Miguel Pure pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.

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