Correlation Between Maple Leaf and SAN MIGUEL

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

By analyzing existing cross correlation between Maple Leaf Foods and SAN MIGUEL BREWERY, you can compare the effects of market volatilities on Maple Leaf 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 Maple Leaf with a short position of SAN MIGUEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maple Leaf and SAN MIGUEL.

Diversification Opportunities for Maple Leaf and SAN MIGUEL

0.86

Correlation Coefficient

Maple Leaf  SAN MIGUEL

Very poor diversification

The 3 months correlation between Maple and SAN is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Maple Leaf Foods and SAN MIGUEL BREWERY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAN MIGUEL BREWERY and Maple Leaf 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 Maple Leaf Foods 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 BREWERY has no effect on the direction of Maple Leaf i.e., Maple Leaf and SAN MIGUEL go up and down completely randomly.

Pair Corralation between Maple Leaf and SAN MIGUEL

Assuming the 90 days trading horizon Maple Leaf is expected to generate 1.41 times less return on investment than SAN MIGUEL. But when comparing it to its historical volatility, Maple Leaf Foods is 3.05 times less risky than SAN MIGUEL. It trades about 0.2 of its potential returns per unit of risk. SAN MIGUEL BREWERY is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  8.08  in SAN MIGUEL BREWERY on April 24, 2025 and sell it today you would earn a total of  1.92  from holding SAN MIGUEL BREWERY or generate 23.76% return on investment over 90 days.

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

Maple Leaf Foods  vs.  SAN MIGUEL BREWERY

Maple Leaf Foods

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Maple Leaf Foods are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Maple Leaf unveiled solid returns over the last few months and may actually be approaching a breakup point.

SAN MIGUEL BREWERY

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SAN MIGUEL BREWERY are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, SAN MIGUEL exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Maple Leaf and SAN MIGUEL

The main advantage of trading using opposite Maple Leaf and SAN MIGUEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maple Leaf 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 Maple Leaf Foods and SAN MIGUEL BREWERY 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.