Correlation Between Filinvest REIT and Easycall Communications

Can any of the company-specific risk be diversified away by investing in both Filinvest REIT and Easycall Communications 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 Filinvest REIT and Easycall Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Filinvest REIT Corp and Easycall Communications Philippines, you can compare the effects of market volatilities on Filinvest REIT and Easycall Communications 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 Filinvest REIT with a short position of Easycall Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Filinvest REIT and Easycall Communications.

Diversification Opportunities for Filinvest REIT and Easycall Communications

0.33

Correlation Coefficient

Filinvest REIT  Easycall Communications

Weak diversification

The 3 months correlation between Filinvest and Easycall is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Filinvest REIT Corp and Easycall Communications Philip in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Easycall Communications and Filinvest REIT 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 Filinvest REIT Corp are associated (or correlated) with Easycall Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Easycall Communications has no effect on the direction of Filinvest REIT i.e., Filinvest REIT and Easycall Communications go up and down completely randomly.

Pair Corralation between Filinvest REIT and Easycall Communications

Assuming the 90 days trading horizon Filinvest REIT Corp is expected to under-perform the Easycall Communications. But the stock apears to be less risky and, when comparing its historical volatility, Filinvest REIT Corp is 7.81 times less risky than Easycall Communications. The stock trades about -0.06 of its potential returns per unit of risk. The Easycall Communications Philippines is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  389.00  in Easycall Communications Philippines on October 12, 2024 and sell it today you would lose (109.00) from holding Easycall Communications Philippines or give up 28.02% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	42.17%
Values	Daily Returns

Filinvest REIT Corp  vs.  Easycall Communications Philip

Filinvest REIT Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Filinvest REIT Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable essential indicators, Filinvest REIT is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Easycall Communications

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Easycall Communications Philippines are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Easycall Communications exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Filinvest REIT and Easycall Communications

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

The idea behind Filinvest REIT Corp and Easycall Communications Philippines 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.