Correlation Between Philippine National and Asiabest Group

Can any of the company-specific risk be diversified away by investing in both Philippine National and Asiabest Group 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 Philippine National and Asiabest Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Philippine National Bank and Asiabest Group International, you can compare the effects of market volatilities on Philippine National and Asiabest Group 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 Philippine National with a short position of Asiabest Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Philippine National and Asiabest Group.

Diversification Opportunities for Philippine National and Asiabest Group

-0.45

Correlation Coefficient

Philippine National  Asiabest Group

Very good diversification

The 3 months correlation between Philippine and Asiabest is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Philippine National Bank and Asiabest Group International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asiabest Group Inter and Philippine National 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 Philippine National Bank are associated (or correlated) with Asiabest Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asiabest Group Inter has no effect on the direction of Philippine National i.e., Philippine National and Asiabest Group go up and down completely randomly.

Pair Corralation between Philippine National and Asiabest Group

If you would invest  2,730  in Philippine National Bank on October 5, 2024 and sell it today you would earn a total of  35.00  from holding Philippine National Bank or generate 1.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	0.0%
Values	Daily Returns

Philippine National Bank  vs.  Asiabest Group International

Philippine National Bank

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Philippine National Bank are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, Philippine National is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Asiabest Group Inter

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Philippine National and Asiabest Group

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

The idea behind Philippine National Bank and Asiabest Group International 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 CEOs Directory module to screen CEOs from public companies around the world.