Correlation Between GigaMedia and Fiskars Oyj
Can any of the company-specific risk be diversified away by investing in both GigaMedia and Fiskars Oyj 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 Fiskars Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GigaMedia and Fiskars Oyj Abp, you can compare the effects of market volatilities on GigaMedia and Fiskars Oyj 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 Fiskars Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of GigaMedia and Fiskars Oyj.
Diversification Opportunities for GigaMedia and Fiskars Oyj
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GigaMedia and Fiskars is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding GigaMedia and Fiskars Oyj Abp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fiskars Oyj Abp 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 Fiskars Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fiskars Oyj Abp has no effect on the direction of GigaMedia i.e., GigaMedia and Fiskars Oyj go up and down completely randomly.
Pair Corralation between GigaMedia and Fiskars Oyj
Assuming the 90 days trading horizon GigaMedia is expected to generate 2.05 times more return on investment than Fiskars Oyj. However, GigaMedia is 2.05 times more volatile than Fiskars Oyj Abp. It trades about 0.31 of its potential returns per unit of risk. Fiskars Oyj Abp is currently generating about 0.21 per unit of risk. If you would invest 133.00 in GigaMedia on October 10, 2024 and sell it today you would earn a total of 24.00 from holding GigaMedia or generate 18.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
GigaMedia vs. Fiskars Oyj Abp
Performance |
| Timeline |
| GigaMedia |
| Fiskars Oyj Abp |
GigaMedia and Fiskars Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GigaMedia and Fiskars Oyj
The main advantage of trading using opposite GigaMedia and Fiskars Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GigaMedia position performs unexpectedly, Fiskars Oyj 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 Fiskars Oyj will offset losses from the drop in Fiskars Oyj's long position.| GigaMedia vs. Ribbon Communications | GigaMedia vs. SK TELECOM TDADR | GigaMedia vs. Telecom Argentina SA | GigaMedia vs. Cogent Communications Holdings |
| Fiskars Oyj vs. GigaMedia | Fiskars Oyj vs. Fuji Media Holdings | Fiskars Oyj vs. ALBIS LEASING AG | Fiskars Oyj vs. UNITED RENTALS |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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