Correlation Between AC Energy and Filinvest REIT

Can any of the company-specific risk be diversified away by investing in both AC Energy and Filinvest REIT 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 AC Energy and Filinvest REIT into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AC Energy Philippines and Filinvest REIT Corp, you can compare the effects of market volatilities on AC Energy and Filinvest REIT 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 AC Energy with a short position of Filinvest REIT. Check out your portfolio center. Please also check ongoing floating volatility patterns of AC Energy and Filinvest REIT.

Diversification Opportunities for AC Energy and Filinvest REIT

0.03

Correlation Coefficient

AC Energy  Filinvest REIT

Significant diversification

The 3 months correlation between ACEN and Filinvest is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding AC Energy Philippines and Filinvest REIT Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Filinvest REIT Corp and AC Energy 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 AC Energy Philippines are associated (or correlated) with Filinvest REIT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Filinvest REIT Corp has no effect on the direction of AC Energy i.e., AC Energy and Filinvest REIT go up and down completely randomly.

Pair Corralation between AC Energy and Filinvest REIT

Assuming the 90 days trading horizon AC Energy Philippines is expected to under-perform the Filinvest REIT. In addition to that, AC Energy is 2.21 times more volatile than Filinvest REIT Corp. It trades about -0.01 of its total potential returns per unit of risk. Filinvest REIT Corp is currently generating about 0.3 per unit of volatility. If you would invest  306.00  in Filinvest REIT Corp on April 25, 2025 and sell it today you would earn a total of  40.00  from holding Filinvest REIT Corp or generate 13.07% return on investment over 90 days.

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

AC Energy Philippines  vs.  Filinvest REIT Corp

AC Energy Philippines

Risk-Adjusted Performance

Very Weak

Over the last 90 days AC Energy Philippines has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, AC Energy is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Filinvest REIT Corp

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Filinvest REIT Corp are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady essential indicators, Filinvest REIT reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with AC Energy and Filinvest REIT

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

The idea behind AC Energy Philippines and Filinvest REIT Corp 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.