Correlation Between Philex Mining and Security Bank

Can any of the company-specific risk be diversified away by investing in both Philex Mining and Security Bank 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 Philex Mining and Security Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Philex Mining Corp and Security Bank Corp, you can compare the effects of market volatilities on Philex Mining and Security Bank 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 Philex Mining with a short position of Security Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Philex Mining and Security Bank.

Diversification Opportunities for Philex Mining and Security Bank

-0.54

Correlation Coefficient

Philex Mining  Security Bank

Excellent diversification

The 3 months correlation between Philex and Security is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Philex Mining Corp and Security Bank Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Security Bank Corp and Philex Mining 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 Philex Mining Corp are associated (or correlated) with Security Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Security Bank Corp has no effect on the direction of Philex Mining i.e., Philex Mining and Security Bank go up and down completely randomly.

Pair Corralation between Philex Mining and Security Bank

Assuming the 90 days trading horizon Philex Mining Corp is expected to under-perform the Security Bank. In addition to that, Philex Mining is 1.3 times more volatile than Security Bank Corp. It trades about -0.08 of its total potential returns per unit of risk. Security Bank Corp is currently generating about 0.15 per unit of volatility. If you would invest  6,200  in Security Bank Corp on April 24, 2025 and sell it today you would earn a total of  1,340  from holding Security Bank Corp or generate 21.61% return on investment over 90 days.

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

Philex Mining Corp  vs.  Security Bank Corp

Philex Mining Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Philex Mining Corp 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 rather sound which may send shares a bit higher in August 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Security Bank Corp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Security Bank Corp are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Security Bank unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Philex Mining and Security Bank

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

The idea behind Philex Mining Corp and Security Bank 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.

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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.