Correlation Between Jollibee Foods and San Miguel

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Can any of the company-specific risk be diversified away by investing in both Jollibee Foods 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 Jollibee Foods and San Miguel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jollibee Foods Corp and San Miguel Pure, you can compare the effects of market volatilities on Jollibee Foods 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 Jollibee Foods with a short position of San Miguel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jollibee Foods and San Miguel.

Diversification Opportunities for Jollibee Foods and San Miguel

JollibeeSanDiversified AwayJollibeeSanDiversified Away100%
-0.01
  Correlation Coefficient

Good diversification

The 3 months correlation between Jollibee and San is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Jollibee Foods Corp and San Miguel Pure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on San Miguel Pure and Jollibee Foods 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 Jollibee Foods Corp 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 Pure has no effect on the direction of Jollibee Foods i.e., Jollibee Foods and San Miguel go up and down completely randomly.

Pair Corralation between Jollibee Foods and San Miguel

Assuming the 90 days trading horizon Jollibee Foods Corp is expected to under-perform the San Miguel. In addition to that, Jollibee Foods is 1.25 times more volatile than San Miguel Pure. It trades about -0.08 of its total potential returns per unit of risk. San Miguel Pure is currently generating about -0.04 per unit of volatility. If you would invest  5,237  in San Miguel Pure on October 21, 2024 and sell it today you would lose (212.00) from holding San Miguel Pure or give up 4.05% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Jollibee Foods Corp  vs.  San Miguel Pure

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -505
JavaScript chart by amCharts 3.21.15JFC FB
       Timeline  
Jollibee Foods Corp 

Risk-Adjusted Performance

0 of 100

 
Weak
 
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Very Weak
Over the last 90 days Jollibee Foods Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan245250255260265270275
San Miguel Pure 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
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.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan5051525354555657

Jollibee Foods and San Miguel Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-3.0-2.25-1.49-0.740.00.691.382.082.78 0.050.100.15
JavaScript chart by amCharts 3.21.15JFC FB
       Returns  

Pair Trading with Jollibee Foods and San Miguel

The main advantage of trading using opposite Jollibee Foods and San Miguel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jollibee Foods 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 Jollibee Foods Corp and San Miguel Pure 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.

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