Correlation Between SAN MIGUEL and G III

Can any of the company-specific risk be diversified away by investing in both SAN MIGUEL and G III 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 G III into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SAN MIGUEL BREWERY and G III Apparel Group, you can compare the effects of market volatilities on SAN MIGUEL and G III 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 G III. Check out your portfolio center. Please also check ongoing floating volatility patterns of SAN MIGUEL and G III.

Diversification Opportunities for SAN MIGUEL and G III

-0.32

Correlation Coefficient

SAN MIGUEL  G III

Very good diversification

The 3 months correlation between SAN and GI4 is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding SAN MIGUEL BREWERY and G III Apparel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G III Apparel 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 BREWERY are associated (or correlated) with G III. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G III Apparel has no effect on the direction of SAN MIGUEL i.e., SAN MIGUEL and G III go up and down completely randomly.

Pair Corralation between SAN MIGUEL and G III

Assuming the 90 days trading horizon SAN MIGUEL BREWERY is expected to generate 2.01 times more return on investment than G III. However, SAN MIGUEL is 2.01 times more volatile than G III Apparel Group. It trades about 0.0 of its potential returns per unit of risk. G III Apparel Group is currently generating about -0.21 per unit of risk. If you would invest  10.00  in SAN MIGUEL BREWERY on December 21, 2024 and sell it today you would lose (0.50) from holding SAN MIGUEL BREWERY or give up 5.0% of portfolio value over 90 days.

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

SAN MIGUEL BREWERY  vs.  G III Apparel Group

SAN MIGUEL BREWERY

Risk-Adjusted Performance

Very Weak

Over the last 90 days SAN MIGUEL BREWERY 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 current stock price tumult, may contribute to shorter-term losses for the shareholders.

G III Apparel

Risk-Adjusted Performance

Very Weak

Over the last 90 days G III Apparel Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with SAN MIGUEL and G III

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

The idea behind SAN MIGUEL BREWERY and G III Apparel Group 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.