Correlation Between GigaMedia and PT Wintermar
Can any of the company-specific risk be diversified away by investing in both GigaMedia and PT Wintermar 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 PT Wintermar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GigaMedia and PT Wintermar Offshore, you can compare the effects of market volatilities on GigaMedia and PT Wintermar 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 PT Wintermar. Check out your portfolio center. Please also check ongoing floating volatility patterns of GigaMedia and PT Wintermar.
Diversification Opportunities for GigaMedia and PT Wintermar
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GigaMedia and W6O is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding GigaMedia and PT Wintermar Offshore in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Wintermar Offshore 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 PT Wintermar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Wintermar Offshore has no effect on the direction of GigaMedia i.e., GigaMedia and PT Wintermar go up and down completely randomly.
Pair Corralation between GigaMedia and PT Wintermar
Assuming the 90 days trading horizon GigaMedia is expected to generate 0.73 times more return on investment than PT Wintermar. However, GigaMedia is 1.37 times less risky than PT Wintermar. It trades about 0.12 of its potential returns per unit of risk. PT Wintermar Offshore is currently generating about -0.07 per unit of risk. If you would invest 133.00 in GigaMedia on October 25, 2024 and sell it today you would earn a total of 13.00 from holding GigaMedia or generate 9.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GigaMedia vs. PT Wintermar Offshore
Performance |
| Timeline |
| GigaMedia |
| PT Wintermar Offshore |
GigaMedia and PT Wintermar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GigaMedia and PT Wintermar
The main advantage of trading using opposite GigaMedia and PT Wintermar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GigaMedia position performs unexpectedly, PT Wintermar 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 PT Wintermar will offset losses from the drop in PT Wintermar's long position.| GigaMedia vs. MAGNUM MINING EXP | GigaMedia vs. Park Hotels Resorts | GigaMedia vs. Perseus Mining Limited | GigaMedia vs. Harmony Gold Mining |
| PT Wintermar vs. Magnachip Semiconductor | PT Wintermar vs. COMBA TELECOM SYST | PT Wintermar vs. Iridium Communications | PT Wintermar vs. TOREX SEMICONDUCTOR LTD |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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