Correlation Between Data IO and Integrated Media
Can any of the company-specific risk be diversified away by investing in both Data IO and Integrated Media 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 Data IO and Integrated Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Data IO and Integrated Media Technology, you can compare the effects of market volatilities on Data IO and Integrated Media 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 Data IO with a short position of Integrated Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Data IO and Integrated Media.
Diversification Opportunities for Data IO and Integrated Media
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Data and Integrated is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Data IO and Integrated Media Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Integrated Media Tec and Data IO 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 Data IO are associated (or correlated) with Integrated Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Integrated Media Tec has no effect on the direction of Data IO i.e., Data IO and Integrated Media go up and down completely randomly.
Pair Corralation between Data IO and Integrated Media
Given the investment horizon of 90 days Data IO is expected to generate 1.22 times less return on investment than Integrated Media. But when comparing it to its historical volatility, Data IO is 2.74 times less risky than Integrated Media. It trades about 0.18 of its potential returns per unit of risk. Integrated Media Technology is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 126.00 in Integrated Media Technology on November 9, 2024 and sell it today you would earn a total of 7.00 from holding Integrated Media Technology or generate 5.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Data IO vs. Integrated Media Technology
Performance |
| Timeline |
| Data IO |
| Integrated Media Tec |
Data IO and Integrated Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Data IO and Integrated Media
The main advantage of trading using opposite Data IO and Integrated Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Data IO position performs unexpectedly, Integrated Media 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 Integrated Media will offset losses from the drop in Integrated Media's long position.The idea behind Data IO and Integrated Media Technology pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Integrated Media vs. SigmaTron International | Integrated Media vs. Data IO | Integrated Media vs. Research Frontiers Incorporated | Integrated Media vs. Maris Tech |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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