Correlation Between GigaMedia and LOANDEPOT INC
Can any of the company-specific risk be diversified away by investing in both GigaMedia and LOANDEPOT INC 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 LOANDEPOT INC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GigaMedia and LOANDEPOT INC A, you can compare the effects of market volatilities on GigaMedia and LOANDEPOT INC 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 LOANDEPOT INC. Check out your portfolio center. Please also check ongoing floating volatility patterns of GigaMedia and LOANDEPOT INC.
Diversification Opportunities for GigaMedia and LOANDEPOT INC
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GigaMedia and LOANDEPOT is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding GigaMedia and LOANDEPOT INC A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LOANDEPOT INC A 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 LOANDEPOT INC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LOANDEPOT INC A has no effect on the direction of GigaMedia i.e., GigaMedia and LOANDEPOT INC go up and down completely randomly.
Pair Corralation between GigaMedia and LOANDEPOT INC
Assuming the 90 days trading horizon GigaMedia is expected to generate 0.34 times more return on investment than LOANDEPOT INC. However, GigaMedia is 2.91 times less risky than LOANDEPOT INC. It trades about 0.04 of its potential returns per unit of risk. LOANDEPOT INC A is currently generating about 0.0 per unit of risk. If you would invest 121.00 in GigaMedia on November 8, 2024 and sell it today you would earn a total of 17.00 from holding GigaMedia or generate 14.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GigaMedia vs. LOANDEPOT INC A
Performance |
| Timeline |
| GigaMedia |
| LOANDEPOT INC A |
GigaMedia and LOANDEPOT INC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GigaMedia and LOANDEPOT INC
The main advantage of trading using opposite GigaMedia and LOANDEPOT INC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GigaMedia position performs unexpectedly, LOANDEPOT INC 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 LOANDEPOT INC will offset losses from the drop in LOANDEPOT INC's long position.| GigaMedia vs. New Residential Investment | GigaMedia vs. Fast Retailing Co | GigaMedia vs. CARSALESCOM | GigaMedia vs. SIDETRADE EO 1 |
| LOANDEPOT INC vs. REVO INSURANCE SPA | LOANDEPOT INC vs. BANKINTER ADR 2007 | LOANDEPOT INC vs. JSC Halyk bank | LOANDEPOT INC vs. Direct Line Insurance |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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