Correlation Between Manila Mining and Jollibee Foods
Can any of the company-specific risk be diversified away by investing in both Manila Mining and Jollibee Foods 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 Manila Mining and Jollibee Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Manila Mining Corp and Jollibee Foods Corp, you can compare the effects of market volatilities on Manila Mining and Jollibee Foods 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 Manila Mining with a short position of Jollibee Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manila Mining and Jollibee Foods.
Diversification Opportunities for Manila Mining and Jollibee Foods
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Manila and Jollibee is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Manila Mining Corp and Jollibee Foods Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jollibee Foods Corp and Manila Mining 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 Manila Mining Corp are associated (or correlated) with Jollibee Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jollibee Foods Corp has no effect on the direction of Manila Mining i.e., Manila Mining and Jollibee Foods go up and down completely randomly.
Pair Corralation between Manila Mining and Jollibee Foods
Assuming the 90 days trading horizon Manila Mining Corp is expected to under-perform the Jollibee Foods. In addition to that, Manila Mining is 1.96 times more volatile than Jollibee Foods Corp. It trades about -0.16 of its total potential returns per unit of risk. Jollibee Foods Corp is currently generating about 0.1 per unit of volatility. If you would invest 22,447 in Jollibee Foods Corp on September 26, 2024 and sell it today you would earn a total of 4,373 from holding Jollibee Foods Corp or generate 19.48% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 55.65% |
Values | Daily Returns |
Manila Mining Corp vs. Jollibee Foods Corp
Performance |
Timeline |
Manila Mining Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Jollibee Foods Corp |
Manila Mining and Jollibee Foods Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Manila Mining and Jollibee Foods
The main advantage of trading using opposite Manila Mining and Jollibee Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manila Mining position performs unexpectedly, Jollibee Foods 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 Jollibee Foods will offset losses from the drop in Jollibee Foods' long position.Manila Mining vs. Nickel Asia Corp | Manila Mining vs. Atok Big Wedge | Manila Mining vs. Philex Mining Corp | Manila Mining vs. Atlas Consolidated Mining |
Jollibee Foods vs. Philex Mining Corp | Jollibee Foods vs. Alliance Select Foods | Jollibee Foods vs. Apex Mining Co | Jollibee Foods vs. Transpacific Broadband Group |
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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