Correlation Between Jardine Matheson and San Miguel

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

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

Diversification Opportunities for Jardine Matheson and San Miguel

-0.25

Correlation Coefficient

Jardine Matheson  San Miguel

Very good diversification

The 3 months correlation between Jardine and San is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Jardine Matheson Holdings and San Miguel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on San Miguel and Jardine Matheson 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 Jardine Matheson Holdings are associated (or correlated) with San Miguel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of San Miguel has no effect on the direction of Jardine Matheson i.e., Jardine Matheson and San Miguel go up and down completely randomly.

Pair Corralation between Jardine Matheson and San Miguel

Assuming the 90 days horizon Jardine Matheson Holdings is expected to under-perform the San Miguel. But the pink sheet apears to be less risky and, when comparing its historical volatility, Jardine Matheson Holdings is 2.55 times less risky than San Miguel. The pink sheet trades about -0.01 of its potential returns per unit of risk. The San Miguel is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  151.00  in San Miguel on November 27, 2024 and sell it today you would lose (1.00) from holding San Miguel or give up 0.66% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	75.51%
Values	Daily Returns

Jardine Matheson Holdings  vs.  San Miguel

Jardine Matheson Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Jardine Matheson Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, Jardine Matheson is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

San Miguel

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in San Miguel are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile fundamental drivers, San Miguel may actually be approaching a critical reversion point that can send shares even higher in March 2025.

Pair Trading with Jardine Matheson and San Miguel

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

The idea behind Jardine Matheson Holdings and San Miguel 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.

Check out your portfolio center.

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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.