Correlation Between MHP Hotel and GigaMedia
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By analyzing existing cross correlation between MHP Hotel AG and GigaMedia, you can compare the effects of market volatilities on MHP Hotel 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 MHP Hotel with a short position of GigaMedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of MHP Hotel and GigaMedia.
Diversification Opportunities for MHP Hotel and GigaMedia
Significant diversification
The 3 months correlation between MHP and GigaMedia is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding MHP Hotel AG and GigaMedia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GigaMedia and MHP Hotel 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 MHP Hotel AG 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 MHP Hotel i.e., MHP Hotel and GigaMedia go up and down completely randomly.
Pair Corralation between MHP Hotel and GigaMedia
Assuming the 90 days trading horizon MHP Hotel is expected to generate 2.61 times less return on investment than GigaMedia. In addition to that, MHP Hotel is 1.6 times more volatile than GigaMedia. It trades about 0.0 of its total potential returns per unit of risk. GigaMedia is currently generating about 0.01 per unit of volatility. If you would invest 128.00 in GigaMedia on September 2, 2024 and sell it today you would earn a total of 5.00 from holding GigaMedia or generate 3.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MHP Hotel AG vs. GigaMedia
Performance |
| Timeline |
| MHP Hotel AG |
| GigaMedia |
MHP Hotel and GigaMedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MHP Hotel and GigaMedia
The main advantage of trading using opposite MHP Hotel and GigaMedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MHP Hotel 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.| MHP Hotel vs. LODESTAR MIN | MHP Hotel vs. Impinj Inc | MHP Hotel vs. Impinj Inc | MHP Hotel vs. Superior Plus Corp |
| GigaMedia vs. Boyd Gaming | GigaMedia vs. Charter Communications | GigaMedia vs. GAMESTOP | GigaMedia vs. FRACTAL GAMING 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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