Correlation Between GigaMedia and KENEDIX OFFICE
Can any of the company-specific risk be diversified away by investing in both GigaMedia and KENEDIX OFFICE 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 KENEDIX OFFICE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GigaMedia and KENEDIX OFFICE INV, you can compare the effects of market volatilities on GigaMedia and KENEDIX OFFICE 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 KENEDIX OFFICE. Check out your portfolio center. Please also check ongoing floating volatility patterns of GigaMedia and KENEDIX OFFICE.
Diversification Opportunities for GigaMedia and KENEDIX OFFICE
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GigaMedia and KENEDIX is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding GigaMedia and KENEDIX OFFICE INV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KENEDIX OFFICE INV 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 KENEDIX OFFICE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KENEDIX OFFICE INV has no effect on the direction of GigaMedia i.e., GigaMedia and KENEDIX OFFICE go up and down completely randomly.
Pair Corralation between GigaMedia and KENEDIX OFFICE
Assuming the 90 days trading horizon GigaMedia is expected to under-perform the KENEDIX OFFICE. But the stock apears to be less risky and, when comparing its historical volatility, GigaMedia is 2.65 times less risky than KENEDIX OFFICE. The stock trades about -0.05 of its potential returns per unit of risk. The KENEDIX OFFICE INV is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 88,000 in KENEDIX OFFICE INV on September 13, 2024 and sell it today you would earn a total of 500.00 from holding KENEDIX OFFICE INV or generate 0.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GigaMedia vs. KENEDIX OFFICE INV
Performance |
| Timeline |
| GigaMedia |
| KENEDIX OFFICE INV |
GigaMedia and KENEDIX OFFICE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GigaMedia and KENEDIX OFFICE
The main advantage of trading using opposite GigaMedia and KENEDIX OFFICE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GigaMedia position performs unexpectedly, KENEDIX OFFICE 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 KENEDIX OFFICE will offset losses from the drop in KENEDIX OFFICE's long position.| GigaMedia vs. AOYAMA TRADING | GigaMedia vs. REGAL ASIAN INVESTMENTS | GigaMedia vs. AM EAGLE OUTFITTERS | GigaMedia vs. HK Electric Investments |
| KENEDIX OFFICE vs. Apple Inc | KENEDIX OFFICE vs. Apple Inc | KENEDIX OFFICE vs. Apple Inc | KENEDIX OFFICE vs. Apple Inc |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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