Correlation Between GigaMedia and ANTA SPORTS
Can any of the company-specific risk be diversified away by investing in both GigaMedia and ANTA SPORTS 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 ANTA SPORTS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GigaMedia and ANTA SPORTS PRODUCT, you can compare the effects of market volatilities on GigaMedia and ANTA SPORTS 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 ANTA SPORTS. Check out your portfolio center. Please also check ongoing floating volatility patterns of GigaMedia and ANTA SPORTS.
Diversification Opportunities for GigaMedia and ANTA SPORTS
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GigaMedia and ANTA is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding GigaMedia and ANTA SPORTS PRODUCT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANTA SPORTS PRODUCT 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 ANTA SPORTS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANTA SPORTS PRODUCT has no effect on the direction of GigaMedia i.e., GigaMedia and ANTA SPORTS go up and down completely randomly.
Pair Corralation between GigaMedia and ANTA SPORTS
Assuming the 90 days trading horizon GigaMedia is expected to generate 1.06 times more return on investment than ANTA SPORTS. However, GigaMedia is 1.06 times more volatile than ANTA SPORTS PRODUCT. It trades about 0.26 of its potential returns per unit of risk. ANTA SPORTS PRODUCT is currently generating about -0.12 per unit of risk. If you would invest 120.00 in GigaMedia on August 25, 2024 and sell it today you would earn a total of 16.00 from holding GigaMedia or generate 13.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GigaMedia vs. ANTA SPORTS PRODUCT
Performance |
| Timeline |
| GigaMedia |
| ANTA SPORTS PRODUCT |
GigaMedia and ANTA SPORTS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GigaMedia and ANTA SPORTS
The main advantage of trading using opposite GigaMedia and ANTA SPORTS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GigaMedia position performs unexpectedly, ANTA SPORTS 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 ANTA SPORTS will offset losses from the drop in ANTA SPORTS's long position.The idea behind GigaMedia and ANTA SPORTS PRODUCT 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.| ANTA SPORTS vs. ALTAIR RES INC | ANTA SPORTS vs. Alaska Air Group | ANTA SPORTS vs. Ryanair Holdings plc | ANTA SPORTS vs. Westinghouse Air Brake |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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