Correlation Between Universal Robina and Apex Mining

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

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

Diversification Opportunities for Universal Robina and Apex Mining

-0.3

Correlation Coefficient

Universal Robina  Apex Mining

Very good diversification

The 3 months correlation between Universal and Apex is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Universal Robina Corp and Apex Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apex Mining and Universal Robina 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 Universal Robina Corp are associated (or correlated) with Apex Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apex Mining has no effect on the direction of Universal Robina i.e., Universal Robina and Apex Mining go up and down completely randomly.

Pair Corralation between Universal Robina and Apex Mining

Assuming the 90 days trading horizon Universal Robina Corp is expected to generate 0.8 times more return on investment than Apex Mining. However, Universal Robina Corp is 1.25 times less risky than Apex Mining. It trades about 0.19 of its potential returns per unit of risk. Apex Mining Co is currently generating about -0.04 per unit of risk. If you would invest  7,150  in Universal Robina Corp on April 23, 2025 and sell it today you would earn a total of  2,350  from holding Universal Robina Corp or generate 32.87% return on investment over 90 days.

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

Universal Robina Corp  vs.  Apex Mining Co

Universal Robina Corp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Universal Robina Corp are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Universal Robina exhibited solid returns over the last few months and may actually be approaching a breakup point.

Apex Mining

Risk-Adjusted Performance

Very Weak

Over the last 90 days Apex Mining Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Universal Robina and Apex Mining

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

The idea behind Universal Robina Corp and Apex Mining Co 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.