Correlation Between T Mobile and PLDT

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

Diversification Opportunities for T Mobile and PLDT

TMUSPLDTDiversified AwayTMUSPLDTDiversified Away100%
-0.87
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between TMUS and PLDT is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding T Mobile and PLDT Inc ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PLDT Inc ADR and T Mobile 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 T Mobile are associated (or correlated) with PLDT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PLDT Inc ADR has no effect on the direction of T Mobile i.e., T Mobile and PLDT go up and down completely randomly.

Pair Corralation between T Mobile and PLDT

Given the investment horizon of 90 days T Mobile is expected to generate 0.67 times more return on investment than PLDT. However, T Mobile is 1.48 times less risky than PLDT. It trades about 0.09 of its potential returns per unit of risk. PLDT Inc ADR is currently generating about 0.02 per unit of risk. If you would invest  13,737  in T Mobile on September 20, 2024 and sell it today you would earn a total of  8,276  from holding T Mobile or generate 60.25% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

T Mobile  vs.  PLDT Inc ADR

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec -1001020
JavaScript chart by amCharts 3.21.15TMUS PHI
       Timeline  
T Mobile 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in T Mobile are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, T Mobile may actually be approaching a critical reversion point that can send shares even higher in January 2025.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec200210220230240
PLDT Inc ADR 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days PLDT Inc ADR has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's technical indicators remain fairly strong which may send shares a bit higher in January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec2122232425262728

T Mobile and PLDT Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-4.82-3.61-2.4-1.190.02021.272.543.815.08 0.050.100.150.20
JavaScript chart by amCharts 3.21.15TMUS PHI
       Returns  

Pair Trading with T Mobile and PLDT

The main advantage of trading using opposite T Mobile and PLDT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if T Mobile position performs unexpectedly, PLDT 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 PLDT will offset losses from the drop in PLDT's long position.
The idea behind T Mobile and PLDT Inc ADR 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.

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