Correlation Between Home Consortium and AiMedia Technologies
Can any of the company-specific risk be diversified away by investing in both Home Consortium and AiMedia Technologies 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 Home Consortium and AiMedia Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Home Consortium and AiMedia Technologies, you can compare the effects of market volatilities on Home Consortium and AiMedia Technologies 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 Home Consortium with a short position of AiMedia Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Home Consortium and AiMedia Technologies.
Diversification Opportunities for Home Consortium and AiMedia Technologies
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Home and AiMedia is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Home Consortium and AiMedia Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AiMedia Technologies and Home Consortium 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 Home Consortium are associated (or correlated) with AiMedia Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AiMedia Technologies has no effect on the direction of Home Consortium i.e., Home Consortium and AiMedia Technologies go up and down completely randomly.
Pair Corralation between Home Consortium and AiMedia Technologies
Assuming the 90 days trading horizon Home Consortium is expected to generate 0.45 times more return on investment than AiMedia Technologies. However, Home Consortium is 2.22 times less risky than AiMedia Technologies. It trades about -0.21 of its potential returns per unit of risk. AiMedia Technologies is currently generating about -0.16 per unit of risk. If you would invest 1,018 in Home Consortium on October 28, 2024 and sell it today you would lose (73.00) from holding Home Consortium or give up 7.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Home Consortium vs. AiMedia Technologies
Performance |
| Timeline |
| Home Consortium |
| AiMedia Technologies |
Home Consortium and AiMedia Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Home Consortium and AiMedia Technologies
The main advantage of trading using opposite Home Consortium and AiMedia Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Home Consortium position performs unexpectedly, AiMedia Technologies 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 AiMedia Technologies will offset losses from the drop in AiMedia Technologies' long position.| Home Consortium vs. Scentre Group | Home Consortium vs. Vicinity Centres Re | Home Consortium vs. Charter Hall Retail | Home Consortium vs. Cromwell Property Group |
| AiMedia Technologies vs. DY6 Metals | AiMedia Technologies vs. Data3 | AiMedia Technologies vs. National Storage REIT | AiMedia Technologies vs. Austco Healthcare |
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 CEOs Directory module to screen CEOs from public companies around the world.
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