Correlation Between Advanced Medical and GigaMedia
Can any of the company-specific risk be diversified away by investing in both Advanced Medical 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 Advanced Medical and GigaMedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advanced Medical Solutions and GigaMedia, you can compare the effects of market volatilities on Advanced Medical 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 Advanced Medical with a short position of GigaMedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advanced Medical and GigaMedia.
Diversification Opportunities for Advanced Medical and GigaMedia
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Advanced and GigaMedia is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Advanced Medical Solutions and GigaMedia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GigaMedia and Advanced Medical 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 Advanced Medical Solutions 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 Advanced Medical i.e., Advanced Medical and GigaMedia go up and down completely randomly.
Pair Corralation between Advanced Medical and GigaMedia
Assuming the 90 days trading horizon Advanced Medical Solutions is expected to under-perform the GigaMedia. But the stock apears to be less risky and, when comparing its historical volatility, Advanced Medical Solutions is 1.01 times less risky than GigaMedia. The stock trades about -0.19 of its potential returns per unit of risk. The GigaMedia is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 134.00 in GigaMedia on October 12, 2024 and sell it today you would earn a total of 20.00 from holding GigaMedia or generate 14.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Advanced Medical Solutions vs. GigaMedia
Performance |
| Timeline |
| Advanced Medical Sol |
| GigaMedia |
Advanced Medical and GigaMedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advanced Medical and GigaMedia
The main advantage of trading using opposite Advanced Medical and GigaMedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advanced Medical 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.| Advanced Medical vs. De Grey Mining | Advanced Medical vs. NXP Semiconductors NV | Advanced Medical vs. MINCO SILVER | Advanced Medical vs. Yanzhou Coal Mining |
| GigaMedia vs. FIH MOBILE | GigaMedia vs. BioNTech SE | GigaMedia vs. Geely Automobile Holdings | GigaMedia vs. Shenandoah Telecommunications |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |