Correlation Between Robinsons Retail and San Miguel

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

Diversification Opportunities for Robinsons Retail and San Miguel

-0.11
  Correlation Coefficient

Good diversification

The 3 months correlation between Robinsons and San is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Robinsons Retail Holdings 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 Robinsons Retail 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 Robinsons Retail 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 Pure has no effect on the direction of Robinsons Retail i.e., Robinsons Retail and San Miguel go up and down completely randomly.

Pair Corralation between Robinsons Retail and San Miguel

Assuming the 90 days trading horizon Robinsons Retail Holdings is expected to under-perform the San Miguel. But the stock apears to be less risky and, when comparing its historical volatility, Robinsons Retail Holdings is 1.22 times less risky than San Miguel. The stock trades about -0.03 of its potential returns per unit of risk. The San Miguel Pure is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  5,307  in San Miguel Pure on October 9, 2024 and sell it today you would lose (37.00) from holding San Miguel Pure or give up 0.7% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Robinsons Retail Holdings  vs.  San Miguel Pure

 Performance 
       Timeline  
Robinsons Retail Holdings 

Risk-Adjusted Performance

0 of 100

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

Robinsons Retail and San Miguel Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Robinsons Retail and San Miguel

The main advantage of trading using opposite Robinsons Retail and San Miguel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Robinsons Retail 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 Robinsons Retail Holdings 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.

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