Correlation Between Star Media and Impiana Hotels
Can any of the company-specific risk be diversified away by investing in both Star Media and Impiana Hotels 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 Star Media and Impiana Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Star Media Group and Impiana Hotels Bhd, you can compare the effects of market volatilities on Star Media and Impiana Hotels 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 Star Media with a short position of Impiana Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Star Media and Impiana Hotels.
Diversification Opportunities for Star Media and Impiana Hotels
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Star and Impiana is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Star Media Group and Impiana Hotels Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Impiana Hotels Bhd and Star Media 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 Star Media Group are associated (or correlated) with Impiana Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Impiana Hotels Bhd has no effect on the direction of Star Media i.e., Star Media and Impiana Hotels go up and down completely randomly.
Pair Corralation between Star Media and Impiana Hotels
Assuming the 90 days trading horizon Star Media is expected to generate 3.16 times less return on investment than Impiana Hotels. But when comparing it to its historical volatility, Star Media Group is 1.77 times less risky than Impiana Hotels. It trades about 0.01 of its potential returns per unit of risk. Impiana Hotels Bhd is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 21.00 in Impiana Hotels Bhd on August 26, 2024 and sell it today you would earn a total of 0.00 from holding Impiana Hotels Bhd or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Star Media Group vs. Impiana Hotels Bhd
Performance |
| Timeline |
| Star Media Group |
| Impiana Hotels Bhd |
Star Media and Impiana Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Star Media and Impiana Hotels
The main advantage of trading using opposite Star Media and Impiana Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Star Media position performs unexpectedly, Impiana Hotels 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 Impiana Hotels will offset losses from the drop in Impiana Hotels' long position.| Star Media vs. Press Metal Bhd | Star Media vs. Riverview Rubber Estates | Star Media vs. Sapura Industrial Bhd | Star Media vs. CB Industrial Product |
| Impiana Hotels vs. Digistar Bhd | Impiana Hotels vs. Minetech Resources Bhd | Impiana Hotels vs. OpenSys M Bhd | Impiana Hotels vs. Insas Bhd |
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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