Correlation Between EMedia Holdings and Impala Platinum
Can any of the company-specific risk be diversified away by investing in both EMedia Holdings and Impala Platinum 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 EMedia Holdings and Impala Platinum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between eMedia Holdings Limited and Impala Platinum Holdings, you can compare the effects of market volatilities on EMedia Holdings and Impala Platinum 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 EMedia Holdings with a short position of Impala Platinum. Check out your portfolio center. Please also check ongoing floating volatility patterns of EMedia Holdings and Impala Platinum.
Diversification Opportunities for EMedia Holdings and Impala Platinum
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between EMedia and Impala is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding eMedia Holdings Limited and Impala Platinum Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Impala Platinum Holdings and EMedia Holdings 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 eMedia Holdings Limited are associated (or correlated) with Impala Platinum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Impala Platinum Holdings has no effect on the direction of EMedia Holdings i.e., EMedia Holdings and Impala Platinum go up and down completely randomly.
Pair Corralation between EMedia Holdings and Impala Platinum
Assuming the 90 days trading horizon eMedia Holdings Limited is expected to generate 0.68 times more return on investment than Impala Platinum. However, eMedia Holdings Limited is 1.47 times less risky than Impala Platinum. It trades about 0.01 of its potential returns per unit of risk. Impala Platinum Holdings is currently generating about -0.01 per unit of risk. If you would invest 35,000 in eMedia Holdings Limited on August 31, 2024 and sell it today you would lose (2,000) from holding eMedia Holdings Limited or give up 5.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.73% |
| Values | Daily Returns |
eMedia Holdings Limited vs. Impala Platinum Holdings
Performance |
| Timeline |
| eMedia Holdings |
| Impala Platinum Holdings |
EMedia Holdings and Impala Platinum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EMedia Holdings and Impala Platinum
The main advantage of trading using opposite EMedia Holdings and Impala Platinum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EMedia Holdings position performs unexpectedly, Impala Platinum 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 Impala Platinum will offset losses from the drop in Impala Platinum's long position.| EMedia Holdings vs. CA Sales Holdings | EMedia Holdings vs. Astral Foods | EMedia Holdings vs. Astoria Investments | EMedia Holdings vs. ABSA Bank Limited |
| Impala Platinum vs. Anglo American Platinum | Impala Platinum vs. Tharisa plc | Impala Platinum vs. Gemfields 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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