Correlation Between BDO Unibank and Puregold Price

Can any of the company-specific risk be diversified away by investing in both BDO Unibank and Puregold Price 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 BDO Unibank and Puregold Price into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between BDO Unibank and Puregold Price Club, you can compare the effects of market volatilities on BDO Unibank and Puregold Price 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 BDO Unibank with a short position of Puregold Price. Check out your portfolio center. Please also check ongoing floating volatility patterns of BDO Unibank and Puregold Price.

Diversification Opportunities for BDO Unibank and Puregold Price

0.09

Correlation Coefficient

BDO Unibank  Puregold Price

Significant diversification

The 3 months correlation between BDO and Puregold is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding BDO Unibank and Puregold Price Club in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Puregold Price Club and BDO Unibank 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 BDO Unibank are associated (or correlated) with Puregold Price. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Puregold Price Club has no effect on the direction of BDO Unibank i.e., BDO Unibank and Puregold Price go up and down completely randomly.

Pair Corralation between BDO Unibank and Puregold Price

Assuming the 90 days trading horizon BDO Unibank is expected to generate 1.09 times more return on investment than Puregold Price. However, BDO Unibank is 1.09 times more volatile than Puregold Price Club. It trades about 0.09 of its potential returns per unit of risk. Puregold Price Club is currently generating about -0.12 per unit of risk. If you would invest  14,418  in BDO Unibank on December 22, 2024 and sell it today you would earn a total of  1,612  from holding BDO Unibank or generate 11.18% return on investment over 90 days.

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

BDO Unibank  vs.  Puregold Price Club

BDO Unibank

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in BDO Unibank are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, BDO Unibank exhibited solid returns over the last few months and may actually be approaching a breakup point.

Puregold Price Club

Risk-Adjusted Performance

Very Weak

Over the last 90 days Puregold Price Club 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 basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with BDO Unibank and Puregold Price

The main advantage of trading using opposite BDO Unibank and Puregold Price positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BDO Unibank position performs unexpectedly, Puregold Price 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 Puregold Price will offset losses from the drop in Puregold Price's long position.

The idea behind BDO Unibank and Puregold Price Club 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.