Correlation Between SOGECLAIR and GigaMedia
Can any of the company-specific risk be diversified away by investing in both SOGECLAIR and GigaMedia 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 SOGECLAIR and GigaMedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SOGECLAIR SA INH and GigaMedia, you can compare the effects of market volatilities on SOGECLAIR and GigaMedia 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 SOGECLAIR with a short position of GigaMedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of SOGECLAIR and GigaMedia.
Diversification Opportunities for SOGECLAIR and GigaMedia
Poor diversification
The 3 months correlation between SOGECLAIR and GigaMedia is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding SOGECLAIR SA INH and GigaMedia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GigaMedia and SOGECLAIR 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 SOGECLAIR SA INH are associated (or correlated) with GigaMedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GigaMedia has no effect on the direction of SOGECLAIR i.e., SOGECLAIR and GigaMedia go up and down completely randomly.
Pair Corralation between SOGECLAIR and GigaMedia
Assuming the 90 days horizon SOGECLAIR is expected to generate 1.18 times less return on investment than GigaMedia. In addition to that, SOGECLAIR is 1.47 times more volatile than GigaMedia. It trades about 0.11 of its total potential returns per unit of risk. GigaMedia is currently generating about 0.19 per unit of volatility. If you would invest 134.00 in GigaMedia on October 18, 2024 and sell it today you would earn a total of 14.00 from holding GigaMedia or generate 10.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SOGECLAIR SA INH vs. GigaMedia
Performance |
| Timeline |
| SOGECLAIR SA INH |
| GigaMedia |
SOGECLAIR and GigaMedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SOGECLAIR and GigaMedia
The main advantage of trading using opposite SOGECLAIR and GigaMedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SOGECLAIR position performs unexpectedly, GigaMedia 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 GigaMedia will offset losses from the drop in GigaMedia's long position.| SOGECLAIR vs. ADRIATIC METALS LS 013355 | SOGECLAIR vs. GREENX METALS LTD | SOGECLAIR vs. ANGANG STEEL H | SOGECLAIR vs. JD SPORTS FASH |
| GigaMedia vs. GRUPO CARSO A1 | GigaMedia vs. Wizz Air Holdings | GigaMedia vs. SOGECLAIR SA INH | GigaMedia vs. VIVA WINE GROUP |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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