Correlation Between AiMedia Technologies and Global Health
Can any of the company-specific risk be diversified away by investing in both AiMedia Technologies and Global Health 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 AiMedia Technologies and Global Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AiMedia Technologies and Global Health, you can compare the effects of market volatilities on AiMedia Technologies and Global Health 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 AiMedia Technologies with a short position of Global Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of AiMedia Technologies and Global Health.
Diversification Opportunities for AiMedia Technologies and Global Health
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between AiMedia and Global is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding AiMedia Technologies and Global Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Health and AiMedia Technologies 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 AiMedia Technologies are associated (or correlated) with Global Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Health has no effect on the direction of AiMedia Technologies i.e., AiMedia Technologies and Global Health go up and down completely randomly.
Pair Corralation between AiMedia Technologies and Global Health
Assuming the 90 days trading horizon AiMedia Technologies is expected to generate 0.78 times more return on investment than Global Health. However, AiMedia Technologies is 1.28 times less risky than Global Health. It trades about 0.05 of its potential returns per unit of risk. Global Health is currently generating about 0.02 per unit of risk. If you would invest 35.00 in AiMedia Technologies on November 9, 2024 and sell it today you would earn a total of 27.00 from holding AiMedia Technologies or generate 77.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AiMedia Technologies vs. Global Health
Performance |
| Timeline |
| AiMedia Technologies |
| Global Health |
AiMedia Technologies and Global Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AiMedia Technologies and Global Health
The main advantage of trading using opposite AiMedia Technologies and Global Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AiMedia Technologies position performs unexpectedly, Global Health 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 Global Health will offset losses from the drop in Global Health's long position.| AiMedia Technologies vs. Event Hospitality and | AiMedia Technologies vs. Data3 | AiMedia Technologies vs. Apiam Animal Health | AiMedia Technologies vs. Flagship Investments |
| Global Health vs. Inventis | Global Health vs. Pengana Private Equity | Global Health vs. PM Capital Global | Global Health vs. Macquarie Group Ltd |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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