Correlation Between GigaMedia and Imperial Metals
Can any of the company-specific risk be diversified away by investing in both GigaMedia and Imperial Metals 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 Imperial Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GigaMedia and Imperial Metals, you can compare the effects of market volatilities on GigaMedia and Imperial Metals 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 Imperial Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of GigaMedia and Imperial Metals.
Diversification Opportunities for GigaMedia and Imperial Metals
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GigaMedia and Imperial is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GigaMedia and Imperial Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imperial Metals 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 Imperial Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imperial Metals has no effect on the direction of GigaMedia i.e., GigaMedia and Imperial Metals go up and down completely randomly.
Pair Corralation between GigaMedia and Imperial Metals
If you would invest 139.00 in GigaMedia on November 4, 2024 and sell it today you would earn a total of 2.00 from holding GigaMedia or generate 1.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
GigaMedia vs. Imperial Metals
Performance |
| Timeline |
| GigaMedia |
| Imperial Metals |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
GigaMedia and Imperial Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GigaMedia and Imperial Metals
The main advantage of trading using opposite GigaMedia and Imperial Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GigaMedia position performs unexpectedly, Imperial Metals 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 Imperial Metals will offset losses from the drop in Imperial Metals' long position.| GigaMedia vs. HK Electric Investments | GigaMedia vs. Tower Semiconductor | GigaMedia vs. CVW CLEANTECH INC | GigaMedia vs. Clean Energy Fuels |
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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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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