Correlation Between AyalaLand Logistics and Philex Mining

Can any of the company-specific risk be diversified away by investing in both AyalaLand Logistics 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 AyalaLand Logistics and Philex Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AyalaLand Logistics Holdings and Philex Mining Corp, you can compare the effects of market volatilities on AyalaLand Logistics 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 AyalaLand Logistics with a short position of Philex Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of AyalaLand Logistics and Philex Mining.

Diversification Opportunities for AyalaLand Logistics and Philex Mining

0.82

Correlation Coefficient

AyalaLand Logistics  Philex Mining

Very poor diversification

The 3 months correlation between AyalaLand and Philex is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding AyalaLand Logistics Holdings 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 AyalaLand Logistics 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 AyalaLand Logistics Holdings 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 AyalaLand Logistics i.e., AyalaLand Logistics and Philex Mining go up and down completely randomly.

Pair Corralation between AyalaLand Logistics and Philex Mining

Assuming the 90 days trading horizon AyalaLand Logistics Holdings is expected to under-perform the Philex Mining. In addition to that, AyalaLand Logistics is 1.02 times more volatile than Philex Mining Corp. It trades about -0.15 of its total potential returns per unit of risk. Philex Mining Corp is currently generating about -0.06 per unit of volatility. If you would invest  309.00  in Philex Mining Corp on October 9, 2024 and sell it today you would lose (24.00) from holding Philex Mining Corp or give up 7.77% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

AyalaLand Logistics Holdings  vs.  Philex Mining Corp

AyalaLand Logistics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AyalaLand Logistics Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's essential indicators remain relatively invariable which may send shares a bit higher in February 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Philex Mining Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Philex Mining Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with AyalaLand Logistics and Philex Mining

The main advantage of trading using opposite AyalaLand Logistics and Philex Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AyalaLand Logistics 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.

The idea behind AyalaLand Logistics Holdings and Philex Mining Corp 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.