Correlation Between C Media and Dimension Computer
Can any of the company-specific risk be diversified away by investing in both C Media and Dimension Computer 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 C Media and Dimension Computer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between C Media Electronics and Dimension Computer Technology, you can compare the effects of market volatilities on C Media and Dimension Computer 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 C Media with a short position of Dimension Computer. Check out your portfolio center. Please also check ongoing floating volatility patterns of C Media and Dimension Computer.
Diversification Opportunities for C Media and Dimension Computer
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between 6237 and Dimension is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding C Media Electronics and Dimension Computer Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dimension Computer and C 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 C Media Electronics are associated (or correlated) with Dimension Computer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dimension Computer has no effect on the direction of C Media i.e., C Media and Dimension Computer go up and down completely randomly.
Pair Corralation between C Media and Dimension Computer
Assuming the 90 days trading horizon C Media Electronics is expected to generate 1.85 times more return on investment than Dimension Computer. However, C Media is 1.85 times more volatile than Dimension Computer Technology. It trades about 0.24 of its potential returns per unit of risk. Dimension Computer Technology is currently generating about -0.24 per unit of risk. If you would invest 4,650 in C Media Electronics on October 15, 2024 and sell it today you would earn a total of 880.00 from holding C Media Electronics or generate 18.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
C Media Electronics vs. Dimension Computer Technology
Performance |
| Timeline |
| C Media Electronics |
| Dimension Computer |
C Media and Dimension Computer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with C Media and Dimension Computer
The main advantage of trading using opposite C Media and Dimension Computer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if C Media position performs unexpectedly, Dimension Computer 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 Dimension Computer will offset losses from the drop in Dimension Computer's long position.| C Media vs. Central Reinsurance Corp | C Media vs. Pontex Polyblend CoLtd | C Media vs. GameSparcs Co | C Media vs. U Media Communications |
| Dimension Computer vs. AVerMedia Technologies | Dimension Computer vs. Bright Led Electronics | Dimension Computer vs. Softstar Entertainment | Dimension Computer vs. C Media Electronics |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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