Correlation Between San Miguel and Apex Mining

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

By analyzing existing cross correlation between San Miguel Pure and Apex Mining Co, you can compare the effects of market volatilities on San Miguel and Apex 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 San Miguel with a short position of Apex Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of San Miguel and Apex Mining.

Diversification Opportunities for San Miguel and Apex Mining

0.16

Correlation Coefficient

San Miguel  Apex Mining

Average diversification

The 3 months correlation between San and Apex is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding San Miguel Pure and Apex Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apex Mining and San Miguel 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 San Miguel Pure are associated (or correlated) with Apex Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apex Mining has no effect on the direction of San Miguel i.e., San Miguel and Apex Mining go up and down completely randomly.

Pair Corralation between San Miguel and Apex Mining

Assuming the 90 days trading horizon San Miguel is expected to generate 81.46 times less return on investment than Apex Mining. But when comparing it to its historical volatility, San Miguel Pure is 1.4 times less risky than Apex Mining. It trades about 0.0 of its potential returns per unit of risk. Apex Mining Co is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest  351.00  in Apex Mining Co on December 29, 2024 and sell it today you would earn a total of  158.00  from holding Apex Mining Co or generate 45.01% return on investment over 90 days.

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

San Miguel Pure  vs.  Apex Mining Co

San Miguel Pure

Risk-Adjusted Performance

Very Weak

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

Apex Mining

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Apex Mining Co are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Apex Mining exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with San Miguel and Apex Mining

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

The idea behind San Miguel Pure and Apex Mining Co 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.