Correlation Between GigaMedia and Santacruz Silver
Can any of the company-specific risk be diversified away by investing in both GigaMedia and Santacruz Silver 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 GigaMedia and Santacruz Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GigaMedia and Santacruz Silver Mining, you can compare the effects of market volatilities on GigaMedia and Santacruz Silver 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 GigaMedia with a short position of Santacruz Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of GigaMedia and Santacruz Silver.
Diversification Opportunities for GigaMedia and Santacruz Silver
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GigaMedia and Santacruz is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding GigaMedia and Santacruz Silver Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Santacruz Silver Mining and GigaMedia 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 GigaMedia are associated (or correlated) with Santacruz Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Santacruz Silver Mining has no effect on the direction of GigaMedia i.e., GigaMedia and Santacruz Silver go up and down completely randomly.
Pair Corralation between GigaMedia and Santacruz Silver
Assuming the 90 days trading horizon GigaMedia is expected to generate 2.37 times less return on investment than Santacruz Silver. But when comparing it to its historical volatility, GigaMedia is 17.12 times less risky than Santacruz Silver. It trades about 0.07 of its potential returns per unit of risk. Santacruz Silver Mining is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 19.00 in Santacruz Silver Mining on September 25, 2024 and sell it today you would lose (1.00) from holding Santacruz Silver Mining or give up 5.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GigaMedia vs. Santacruz Silver Mining
Performance |
| Timeline |
| GigaMedia |
| Santacruz Silver Mining |
GigaMedia and Santacruz Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GigaMedia and Santacruz Silver
The main advantage of trading using opposite GigaMedia and Santacruz Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GigaMedia position performs unexpectedly, Santacruz Silver 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 Santacruz Silver will offset losses from the drop in Santacruz Silver's long position.| GigaMedia vs. COMBA TELECOM SYST | GigaMedia vs. GREENX METALS LTD | GigaMedia vs. Iridium Communications | GigaMedia vs. PARKEN Sport Entertainment |
| Santacruz Silver vs. ATRYS HEALTH SA | Santacruz Silver vs. EPSILON HEALTHCARE LTD | Santacruz Silver vs. ONWARD MEDICAL BV | Santacruz Silver vs. MeVis Medical Solutions |
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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